- 50 -
Financial Secretary's TV broadcast
Following is the full text of the Financial Secretary, Mr Donald Tsang's TV Broadcast on the Budget speech today (Wednesday);
Good evening,
This afternoon I presented the Government's annual budget to the Legislative Council. Nothing unusual in that, you might say. But this is after all 1997, the year when many things in Hong Kong are scheduled to change.
It is the year in which we cease to be a dependent territory under British Administration. It is the year in which we become a Special Administrative Region of the People's Republic of China.
At a time when such great changes are afoot, and in particular when the eyes of the world are watching us closely, I thought it would be useful to remind everyone just how many things are set to remain the same. Hence the title of my Budget Speech: Continuity in a Time of Change.
The Budget covers a full financial year from 1 April to 31 March. As usual. It forecasts continuing real growth in our economy, and sturdy public finances. As usual. Our taxes remain low, simple and predictable. As usual.
Our continuing success means we generate the wealth to meet the community's expectations for improvements in housing, education, welfare, healthcare, and law and order. This year we will spend over $200 billion for the first time: $45 billion on education; $28 billion on health; $21 billion on welfare. And, together with the Housing Authority, over $32 billion on housing programmes.
This shows we are a caring community. A community which puts its money where its heart is. But we do not allow our hearts to rule our heads. Money for the improvements we make comes from economic growth, not deficit budgets. So we have no debts and we can keep our taxes low.
Which brings me to the other half of the Budget: revenue. There are a few minor increases in duty. But everywhere else we will be reducing taxes. Altogether I have proposed concessions of over $5 billion. On salaries tax, I am increasing the personal allowance from $90,000 to $100,000. I am also overhauling the marginal tax bands. This means a family of four earning $22,000 per month will pay less than $20 a month in tax. Altogether, 96% of our salaries taxpayers will benefit. The rates percentage charge will be reduced to an all time low of 5%.
About 50,000
homebuyers at the lower end of the market will pay less Stamp Duty. As you can see, the main beneficiaries will be sandwich class taxpayers and ratepayers.