- 11.
Members have suggested that Government should set up an Economic Development Board, Council, Committee, or similar agency, with public participation. This new body would be tasked with steering Hong Kong's economic development in the "right direction", winning more foreign inward investment, tackling our economic problems and making us more competitive. These are all worthwhile endeavours.
But it is not immediately clear to me whether Members are proposing policy- making and executive powers for this body or whether it would function simply as an advisory capacity. If the latter, I doubt whether the formation of such a body would add much more than an extra layer of redundant bureaucracy to the existing and well- tried network of advisory committees, boards and committees. These already provide the Government with valuable views and suggestions on economic and related issues. The Governor's Business Council and my own Economic Advisory Committee are two such examples.
If, on the other hand, the intention is that we should give this body powers to make and implement policies for economic development, I would have serious reservations. So I think would a majority of Members of this Council. First, this would derogate from the Government's existing duty to formulate policy on economic issues. Second, such a body might lead us to stray from our fundamental economic strategy which leaves the private sector to generate our economic growth free from government direction and interference. The direction on the private sector has served us well during more than three decades of sustained economic growth. It is generally accepted by the community. I am by no means convinced that a radical departure from our well-tried economic principles would be in Hong Kong's best interests.
Revenue Measures
I am grateful for Members' suggestions regarding possible taxation measures that we might adopt in order to advance our economic interests. As I mentioned earlier, I am now in the process of consulting Members on the revenue measures for the next Budget. This consultation exercise is an important part of the Budget exercise. I can assure Members that we will be considering their views and advice in detail and with great care before I formulate my proposals for the next Budget.
I am sure that Members will wish me to consider their ideas for tax cuts with one eye on our established fiscal policies and on the other on our actual budgetary position. We will need first to ask ourselves two questions: First, can we afford the concessions? Second, will the lower taxes provide relief where it is needed most? And, while tax concessions are superficially attractive, they can have very serious and wide-ranging implications for our economic performance as a whole.