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"Lower rates for business firms are another contribution to ensuring Hong Kong is as user-friendly as possible to business, thus reinforcing our role as an international business centre," he stressed.
The net effect of these proposals on revenue from general rates was that in 1997/98, it would remain at the 1996/97 level of about $6.3 billion, whereas the two Councils' rates would increase from $9.4 billion to $10.3 billion. The cost of these proposals to general rates was $1.2 billion in 1997-98 and $3.4 billion up to the end of the century, he added.
The Financial Secretary said: "In formulating my proposals on rates, I have not lost sight of the government rents which some ratepayers will have to pay from July 1997 in accordance with Annex III to the Joint Declaration and Article 121 of the Basic Law.
"I have also taken into account the financial position of the Urban Council and the Regional Council, their planned programmes of activities and their rates revenue requirements for the next triennium, since their main source of funding comes from
rates."
On the routine revaluation of rates during 1996/97, which was mentioned in his last Budget speech, Mr Tsang said the general revaluation had been completed and, based on rental values on July 1, 1996, the overall average increase in rateable values was around 17 per cent.
Domestic properties showed an average increase of 23 per cent and non- domestic properties an average increase of only 10 per cent for the past three years. The rateable values for approximately 8 per cent of properties would actually decrease or remain unchanged.
Referring to the possibility of conducting the general revaluation on an annual basis, Mr Tsang said the objective would be to introduce smaller rises in rates each year instead of a larger rise once every three years.
"This is a complex issue which we are still studying," he said. But he assured the Legislative Council that the views of Members and the public would be carefully considered before any final decision would be taken.
The proposals will cone into effect on April 1 this year.
End