XN000022-1974-03-14 — Page 25

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Thursday, March 14, 1974

VACANT PREMISES TO BE EXEMPT FROM PROPERTY TAX

Owners of vacant properties will once again be entitled to

full refunds of property tax on such premises, under amending legislation

introduced in the Legislative Council today.

At present, they are only entitled to half refunds but the

Inland Revenue (Amendment) Bill 1974 will restore full exemption of

property tax on vacant premises as was the position before April 1 last

year.

Moving the second reading of the bill, the Financial Secretary,

the Hon. Philip Haddon-Cave, explained that when half rates were introduced

under the Rating Ordinance, "we also introduced half property tax

coincidentally, without realising at that time that such a move was illogical."

Ho gave three reasons for reverting back to full exemption.

Owners of properties used for producing profits would be able to

off-set their half property tax against profits, and most corporations would

not be liable for the half property tax since they are exempted, he explained.

In addition, to presume income when there was by definition no source

for it was a departure from the principles underlying taxation in Hong Kong.

Another amendment introduced in the bill aims to relieve owners of

pre-war rent restricted properties from paying increased property tax

following a re-assessment of rateable value.

Previously, the Financial Secretary said, the restricted rent

passing had in many cases been accepted as the basis of rateable value because

of doubts as to its assessment for these premises.

"These doubts