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HONG KONG LEGISLATIVE COUNCIL
HON. MR. CHAU TSUN-NIN.-Your Excellency, I beg to ask for a division.
The Council divided and the motion was carried by 13 votes to 3. The Honourable Mr. D. F. Landale, the Honourable Mr. Lo Man-kam, C.B.E., the Honourable Mr. R. D. Gillespie, the Honourable Mr. M. M. Watson, the Officer Commanding the Troops, the Colonial Secretary, the Attorney General, the Secretary for Chinese Affairs, the Financial Secretary, the Honourable Mr. T. Megarry, the Honour- able Mr. V. Kenniff, the Honourable Dr. I. Newton and the President voted for, and the Honourable Mr. Chau Tsun-nin, C.B.E., the Honourable Mr. Leo d'Almada e Castro and the Honourable Dr. Chau Sik-nin voted against the motion.
The Bill was read a Second time.
On the motion of the Financial Secretary, seconded by the Colonial Secretary, Council then went into Committee to consider the Bill clause by clause.
Clause 10.
THE FINANCIAL SECRETARY.-I beg to move that sub-clause 2 of this clause be amended by the insertion of the words "the rental value payable by the employer or if the place of residence is owned by the employer" between the words "shall be" and "the rateable value".
I also move that the expression (a) be inserted between the words "over" and "one-sixth" in line 4, and that the words "or (b) four thousand dollars whichever is the lower amount" be inserted between the words "sub-section (1) (i)" and "shall be" in line 5.
The Bill at present provides that the rental value of any place of residence provided rent free by the employer shall be the rateable value. In many cases, owing to the housing position, employers are forced to accommodate their employees in hotels. The rooms have no separate rateable value but clearly if the value of free quarters or quarters at a reduced rental is taken into consideration for the purposes of the assessment of tax, hotel accommodation provided free by the employer must also be included in the assessment.
As the Bill is at present drafted, any addition to chargeable income in respect of free quarters or quarters at a reduced rental is limited to one-sixth of the income before any addition is made in respect of such accommodation. Owing to the very high cost of hotel accommodation the effect of the amendment might be to put hotel residents in the higher income groups at a disadvantage as compared with those residing in houses or flats provided by their employers. The difficulty arises as a result of the abnormal conditions under which we are living but after much consideration Government has come to the conclusion that the best way of removing any inequity on this score will be to place an over-riding limit of four thousand dollars on the amount which can be added in respect of the value of quarters.
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