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More air passenger departure tax
The Financial Secretary, Mr Donald Tsang, proposes to increase the Air Passenger Departure Tax from $50 to $100, which was the level when the tax was first introduced in 1983.
He said the current level of the tax was well below the average for the region.
The raise will bring the tax more in line with the level charged by other places in the region.
The tax was reduced from $150 to $50 in the 1994-95 Budget. Some legislators felt that the reduction was excessive and unjustified, and criticised the Government.
"With hindsight, these criticisms had some validity. The reduction obviously affected revenue."
But it did not achieve the intended purpose of encouraging transit passengers to leave the transit halls so as to enhance the business of our retail trade and alleviate congestion at the airport.
Mr Tsang said statistics also showed that an increase or a decrease in the tax had no effect on passenger throughput.
He emphasised that the proposed increases in air passenger departure tax, like those on tobacco and fuel duties and betting, are essential in order to allow the Government to fund the various revenue concessions that he proposed to introduce in this Budget.
"They are an integral part of my Budget package," said Mr Tsang.
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