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Stamp duty on property transactions to be adjusted
The Financial Secretary, Mr Donald Tsang, today (Wednesday) proposed to adjust the threshold values for the various stamp duty bands to benefit those buying flats with a value of $4 million or less.
As a result of the proposed adjustments, the stamp duty paid on a $2 million flat will be halved, from $30,000 to $15,000.
Moving the second reading of the Appropriation Bill 1997, Mr Tsang estimated that about 50,000 property transactions would benefit from the proposal in 1997/98.
"The concession will cost $620 million in 1997/98 and $3 billion up to 2000- 01," he added.
He explained that he made adjustments to stamp duty on property transactions last year in order to benefit buyers of lower to medium-value flats, in particular those bought under the Home Ownership and Sandwich Class Housing Schemes.
"Increases in property prices have eroded this concession since the last Budget. Because of the Government's commitment to encouraging home ownership, I would like to restore the effect of last year's concession," he said.
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Foreign withholding tax to be amended
The Financial Secretary, Mr Donald Tsang, proposed today (Wednesday) to amend the part on foreign withholding tax in the Inland Revenue Ordinance.
He explained that a judicial decision had indicated that foreign withholding tax charged on income or turnover was a legitimate expense, which should be deductible in determining assessable profits whatever the residency status of the company concerned.
The Inland Revenue Department is following the judicial decision in its practice, he said.