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To recognise the special difficulties faced by single parents and families caring for dependants with a disability, the allowances for single parents and disabled dependants will be increased by 66.7 per cent from $45,000 to $75,000 and from $15,000 to $25,000 respectively. To encourage our work force to upgrade its professional and technical qualifications so as to keep Hong Kong as a premier centre for business in the world, the maximum deduction for training expenses will be increased by 66.7 per cent from $12,000 to $20,000 a year.
As for the marginal salaries tax structure, the Bill seeks to standardise the band widths at $30,000 and the rates at uniform intervals of 6 per cent. Let me explain the changes -
(a)
the first band will be widened from $20,000 to $30,000, and the rate will be kept at the current low level of 2 per cent;
(b)
the width of the second band will be maintained at $30,000, but the rate will be reduced from 9 per cent to 8 per cent;
(c)
the width of the third band will also be maintained at $30,000, but the rate will be reduced from 17 per cent to 14 per cent; and
(d)
the top marginal tax rate will be kept at the current level of 20 per cent.
The rationalisation will give added relief to middle-income salaries taxpayers, especially the "sandwich class". It will not affect the tax net.
I believe that there is wide support in both the community and this Council for the proposed salaries tax concessions following their announcement in the Budget.
Mr President, with these remarks, I commend the Bill to Members.
End