XN000022-1975-10-24 — Page 8

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FRIDAY, OCTOBER 24, 1975

BASIS FOR CALCULATING PROPERTY TAX REVISED

X X X X X X

VALUES OF PREMISES. FOR PROPERTY TAX PURPOSES WILL IN FUTURE DE ASSESSED SEPARATELY FROM RATEADLE VALUES IF PROPOSED LEGISLATION IS PASSED INTO LAU.

THE PROPOSAL, CONTAINED UNDER THE INLAND REVENUE (AMENDMENT) (NO. 6) BILL 1975, WAS FIRST PUT FORTH BY THE FINANCIAL SECRETARY IN HIS 1975 BUDGET SPEECH.

THE NEW CALCULATION BASIS WILL ENABLE VALUES FOR PROPERTY TAX TO BE ASSESSED IN LINE WITH CURRENT MARKET RENTAL VALUES, TAKING INTO ACCOUNT STATUTORY RENT RESTRICTIONS.

IN ADDITION, IF TAX IS CHARGED FOR THE FIRST TIME, THE ASSEUSABLE VALUE WILL BE BASED ON THE RENTS RULING AT THAT DATE.

IT ALSO REFLECTS THE FACT THAT WHILE RATES ARE BASICALLY A TAX ON OCCUPIERS OF PREMISES FOR THE PAYMENT OF LOCAL SERVICES, PROPERTY TAX IS. INTENDED TO LE A TAX ON INCOME DERIVED FROM OWNERSHIP OF PROPERTY.

IN FUTURE, SINCE THE NEW CALCULATIONS WILL ALREADY HAVE TAKEN ACCOUNT OF RENT RESTRICTIONS, THE PRESENT CONCESSIONARY RATE OF ONLY ONE-HALF THE STAND."RD PROPERTY TAX RATE CHARGED ON PRE-WAR PREMISES WILL BE SUPERSEDED.

TO ALLOW FOR EXPENSES ON REPAIRS AND OUTGOINGS HOWEVER, THE EXISTING ALLOWANCE OF 20 PER CENT WILL CONTINUE.

IT IS EXPECTED THAT THE PROPOSED NEW METHOD OF ASSESSMENT WILL BE EFFECTIVE AS FROM THE YEAR 1976-77.

ALSO PROPOSED IN THE NEW BILL FOR MINOR AMENDMENT TO THE MAIN ORDINANCE IS THE INCLUSION OF DONATIONS TO THE GOVERNMENT FOR CHARITABLE PURPOSES AS AN APPROVED CHARITABLE DONATION, TO RANK AS A DEDUCTION FOR TAX PURPOSES.

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