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On the proposal for an annual revaluation, I should perhaps remind Members that we have put it forward in response to suggestions from some Members in previous Budget debates that it would be preferable to have more frequent, say annual, but smaller increases in rates than a large increase every three years following a general revaluation. Let me make one thing very clear: the aim of the proposal is to soften the impact of revaluation, not to raise additional revenue. The proposal, if adopted, would also enhance fairness in the assessment of the rateable value of properties, as changes in rentals, which can be up or down, would be more accurately reflected. We will carefully examine the views of Members and of the public in determining whether a revaluation should be conducted on an annual basis after the forthcoming general revaluation.
Tax Relief for Housing-Related Expenditure
Second, tax relief for mortgages. Some Members repeated their call for a new salaries tax allowance for expenditure on mortgage interest for first-time home buyers. I must point out that a tax concession of such a nature in favour of a particular type of investment would tend to distort the allocation of resources and investment in the private sector. It is also very costly to the public purse. We remain convinced that we should focus our resources and continue to invest in our public housing programme in order to provide direct assistance to those genuinely in need. We should also keep up our efforts to maintain an adequate supply of land to ensure the healthy and steady development of the private housing sector. The proposed concession on stamp duty for property transactions announced by the Financial Secretary in his Budget Speech will also help to alleviate the burden on home buyers at the lower to middle end of the market, including those who wish to purchase Home Ownership Scheme flats and Sandwich Class Housing Scheme properties.
Fees and Charges
Third, fees and charges. There have been very thorough discussions on the subject of fees and charges in this Council in the last few months and I do not wish to repeat our principles and policies here today. However, I do wish to take this opportunity to respond to some of the points and suggestions made by Members.
We will continue our existing policy of keeping our fees and charges under regular review. Members may wish to know that we are planning to table in this Council a further 120 or so fee amending regulations, including the one on water charges, within this LegCo session.
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