THURSDAY, MAY 19, 1988
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TECHNICALITIES OF SEPARATE TAXATION SYSTEM EXPLAINED
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THE SYSTEM OF SEPARATE TAXATION PROPOSED FOR HONG KONG ENTAILS THAT THE REQUIREMENT TO LODGE TAX RETURNS AND PAY TAX BE MANDATORILY IMPOSED ON ALL TAXPAYERS REGARDLESS OF MARITAL STATUS,
THE COMMISSIONER OF INLAND REVENUE, MR ANTHONY AU THIS AT A PRESS BRIEFING HELD TODAY (THURSDAY) TO TECHNICALITIES OF THE PROPOSED SEPARATE TAXATION SYSTEM.
YEUNG, SAID EXPLAIN THE
IN OTHER WORDS, BOTH HUSBANDS AND WIVES WILL BE INDIVIDUALLY REQUIRED TO FILE SEPARATE SALARIES TAX RETURNS AND ENTITLED ΤΟ A SINGLE PERSONAL ALLOWANCE.
EXPLAINING HOW THE PROPOSED SYSTEM WILL WORK, MR AU YEUNG SAID BOTH HUSBANDS AND WIVES CAN ELECT AS TO WHO WILL CLAIM THE ALLOWANCE IN RESPECT OF EACH DEPENDENT PARENT AND/OR DEPENDENT PARENT-IN-LAW.
HUSBANDS AND WIVES WILL BE REQUIRED TO IRREVOCABLY ELECT WHICH OF THEM WILL CLAIM CHILD ALLOWANCE FOR ALL OF THEIR CHILDREN ON A GROUP BASIS FOR EACH YEAR OF ASSESSMENT.
IN CASES WHERE UNDER SEPARATE TAXATION EITHER THE HUSBAND OR THE WIFE HAS "UNABSORBED ALLOWANCES" THE INLAND REVENUE DEPARTMENT WILL ALLOW SPOUSES TO JOINTLY ELECT FOR JOINT ASSESSMENT SO AS TO TAKE THE MAXIMUM BENEFIT OF THE ALLOWANCES AVAILABLE TO THE FAMILY.
INCOME
"UNABSORBED ALLOWANCES" WILL ARISE WHERE THE ASSESSABLE OF ONE OF THE SPOUSES IS NOT SUFFICIENT TO ABSORB ALL THE ALLOWANCES CLAIMED BY HIM OR HER.
UNDER JOINT ASSESSMENT, EMPLOYMENT INCOMES OF A MARRIED COUPLE WILL BE AGGREGATED AND THE FUL. PERSONAL ALLOWANCES OF $74,000 AS AFFORDED TO EXISTING MARRIED TAXPAYERS WILL BE GRANTED.
LIKEWISE, FOR SINGLE INCOME FAMILIES, THAT IS FAMILIES WHERE EITHER THE HUSBAND OR THE WIFE WAS NOT IN RECEIPT OF SALARY INCOME AT ANY TIME DURING THE YEAR OF ASSESSMENT, A FULL MARRIED TAXPAYER'S ALLOWANCE WILL CONTINUE TO BE GRANTED.
ON AN IMPLEMENTATION DATE FOR SEPARATE TAXATION, MR AU YEUNG SAID THAT AS THE PHILOSOPHY OF SEPARATE TAXATION 15 BASED ON AN ENTIRELY DIFFERENT PREMISE To THAT OF THE EXISTING SYSTEM OF AGGREGATION OF INCOME. SUBSTANTIAL LEGISLATIVE AMENDMENTS ΤΟ THE INLAND REVENUE ORDINANCE WILL BE REQUIRED.
BE
"ON THE ADMINISTRATIVE SIDE, VERY CONSIDERABLE WORK WILL NEEDED TO REDEFINE EXISTING PROCEDURES TO CATER FOR SEPARATE TAXATION, TO AMEND COMPUTER PROGRAMMES TO TREAT MARRIED WOMEN AS TAXPAYERS IN THEIR OWN RIGHT AND TO REDESIGN STATUTORY AND NON-STATUTORY FORMS TO CONFORM WITH THE REQUIREMENT OF THE AMENDED LEGISLATION AND THE NEW SYSTEMS INTRODUCED TO IMPLEMENT IT,' HE SAID.
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