WEDNESDAY, MARCH 2, 1994
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INFLATION REMAINS A DIFFICULT CHALLENGE. CONSUMER PRICES WILL INCREASE BY AROUND 8.5% AGAIN IN 1994. THIS IS NOT A FIGURE WE CAN BE COMPLACENT ABOUT, THOUGH IT IS A SIGNIFICANT IMPROVEMENT OVER RECENT YEARS. AND INFLATION, TO SOME EXTENT, IS THE PRICE WE HAVE HAD TO PAY FOR OUR SUSTAINED ECONOMIC GROWTH, AND THE FULL EMPLOYMENT WHICH GOES WITH IT.
BUT WE MUST DO MORE TO EASE THE CONSTRAINTS WHICH ARE THE CAUSE OF OUR INFLATION. WE WILL DO EVERYTHING WE CAN TO INCREASE THE SUPPLY OF LAND AND TO ENCOURAGE REDEVELOPMENT OF EXISTING BUILDINGS. WE MUST ALSO FIND NEW AND ACCEPTABLE WAYS TO EXPAND OUR LIMITED WORKFORCE. WE WILL SHORTLY MAKE A USEFUL START WITH A NEW SCHENE TO ADMIT GRADUATE PROFESSIONALS AND MANAGERS RECRUITED DIRECTLY FROM CHINA.
NEVERTHELESS, THE CONTINUED SUCCESS OF OUR ECONOMY HAS CREATED VERY HEALTHY PUBLIC FINANCES. FOR THE COMING FINANCIAL YEAR, WE ARE BUDGET ING FOR A SURPLUS, AND THE LEVEL OF RESERVES FORECAST FOR 1997 HAS RISEN GREATLY EVEN AFTER ALLOWING FOR FURTHER SPENDING ON THE AIRPORT.
GIVEN OUR BUOYANT REVENUES AND COMFORTABLE RESERVES, I DECIDED WE COULD AFFORD MAJOR TAX CONCESSIONS, IN DECIDING WHERE ΤΟ MAKE THOSE CUTS, I HAVE LISTENED CAREFULLY TO THE ADVICE I HAVE RECEIVED IN MY CONSULTATIONS WITH MEMBERS OF LEGCO, AS WELL AS FROM PROFESSIONAL BODIES, COMMERCIAL ASSOCIATIONS, AND LABOUR AND WELFARE GROUPS.
ALMOST
THIS AFTERNOON. I HAVE PUT FORWARD PROPOSALS TO BENEFIT
+ EVERYONE PAYING SALARIES TAX. FOR 420,000 TAXPAYERS, MY PROPOSALS WILL MEAN THAT THEY PAY NOTHING AT ALL, IN FUTURE. FOR ANOTHER 1.1 MILLION, TAX BILLS WILL BE VERY CONSIDERABLY REDUCED. IT IS AN AMAZING FACT THAT THE PROPORTION OF THE WORKING POPULATION WHO PAY NO SALARIES TAX REPEAT, ZERO SALARIES TAX WILL INCREASE FROM 43% TO
I 58%.
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BUT I HAVE NOT CONFINED MY CONCESSIONS TO SALARIES TAX. I HAVE ALSO BEEN ABLE TO REDUCE CORPORATE TROFITS TAX. FOR SOME, THIS WILL BE PARTLY OFFSET BY THE INCREASE I HAVE PROPOSED IN THE BUSINESS REGISTRATION FEE. I HAVE ALSO REDUCED AIRPORT DEPARTURE TAX, ESTATE DUTY, AND STAMP DUTY ON THE PURCHASE OF LOWER AND MEDIUM-VALUE FLATS. I HAVE PROPOSED NO INCREASE IN TOBACCO DUTY, A SIMPLE INFLATION INCREASE IN THE DUTY ON PETROL, AND A COMPLETE REFORM OF THE COMPLEX SYSTEM OF DUTIES ON ALCOHOL. I HAVE ALSO TRIPLED THE LOTTERIES SHARE OF MARK 6 PROCFEDS TO MEET EXPENDITURE ON PROJECTS. AT THE SAME TIME, I HAVE TAKEN STEPS TO BLOCK LOOPHOLES WHICH ALLOW OUR LOW TAXES TO BE AVOIDED.
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SOCIAL
FUND'S
WELFARE
ΤΟ
IN
OUT
THE TAX CUTS I HAVE PROPOSED HAVE NOT AFFECTED OUR ABILITY FIND MORE MONEY FOR EXISTING PROGRAMMES AND FOR NEW INITIATIVES. HIS POLICY ADDRESSES TO LEGCO IN 1992 AND 1993, THE GOVERNOR SET AMBITIOUS TARGETS FOR IMPROVEMENTS IN OUR EDUCATION AND PROGRAMMES, ON HEALTH AND HOSPITAL SERVICES AND OUR SOCIAL WELFARE SERVICES. WE WILL BE ABLE TO FINANCE ALL THESE TARGETS FOR THE COMING YEAR.
TRAINING
ALL IN ALL. J HAVE TRIED TO MAKE MY BUDGET MEET THE NEEDS AND EXPECTATIONS OF THE COMMUNITY. MY AIM IN THIS BUDGET HAS BEEN TO MANAGE THE PROSPERITY WE HAVE ACHIEVED TO ALLOW THE HARD-WORKING MEN AND WOMEN OF HONG KONG TO ENJOY THE BENEFITS OF THIS SUCCESS, AND то ENSURF THAT THIS SUCCESS, AND WITH IT OUR WAY OF LIFE, CONTINUES THE FUTURE.
GOOD NIGHT.
IN
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