CO129-595-3 Proposed introduction of income tax 12-12-1946 - 26-1-1947 — Page 30

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classes and is fixed by a separate provision in Chapter I.

If any individual feels aggrieved at being taxed at the

full rate on 100 of his income,

of his income, Chapter VII provides

him with a remedy in the form of the right to personal

assessment should he so elect. If, for reasous of his

he prefers not to disclose his business interests he must

be prepared to pay the price of such secrecy in the form of

the full rate of tax on the whole of his income.

4.

Property Tax (Chapter II).

I propose a deduction from the full rateable value

for repairs, at a rate to be decided in Hong Kong. Otherwise

there is no change here other than the application of the

full rats instead of half-rate as previously.

5. Profits Tax (Chapter IV).

Under the 1941 Ordinance, Corporation profits bore

tax at the full rate, whereas the profits of non-ingʊrporated

persone bore it at a reduced rate on the first $50,000. In

accordance with the policy set out above I propose the full

rate throughout. In order, however, not to tax small

businesses below a reasonable minimum standard, I retain a

provision exempting business with profits below an amount to

be fixed in Hong Kong.

In section 17 I have substituted the provisions of

the Heel Ordinanse regarding the computation of profits for

those of the 1941 Ordinance, excepting the matter of

depreciation. This latter I have provided for in a separate

Chapter (Chapter VI) based broadly on the provisions of the

U.I. Income Tax Act 1945, Part I and II (the remaining parts

of that Aat are hardly applicable to Hong Kong but could be

adopted if and when circumstances make them necessary). The

granting of the "initial allowances" in respect of

expenditure on industrial buildings, machinery or plant from,

in effect, 1946 expenditure on-wards, I regard as a measure

of relief for rehabilitation and modernisation expenditure.

In/

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