XN000022-1980-05-14 — Page 19

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WEDNESDAY, MAY 14, 1980

PROPOSAL TO RAISE CEILING OF TAX-FREE INTEREST

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A BILL SEEKING TO RAISE TO 10.5 PER CENT THE MAXIMUM RATE WHICH MAY BE SPECIFIED BY THE FINANCIAL SECRETARY FOR THE PURPOSE OF EXEMPTING INTEREST FROM TAX WAS INTRODUCED IN THE LEGISLATIVE COUNCIL TODAY (WEDNESDAY).

A REVENUE PROTECTION ORDER, GIVING EFFECT TO THE NEW RATE FOR THE TIME BEING WAS MADE ON MARCH 11.

MOVING THE SECOND READING OF THE INLAND REVENUE (AMENDMENT) BILL 1980, THE ACTING CHIEF SECRETARY, THE HON SIR PHILIP HADDON-CAVE SAID THAT THE MAIN ORDINANCE PROVIDED FOR EXEMPTION FROM TAX OF INTEREST PAYABLE BY THE GOVERNMENT, BY LICENSED BANKS AND BY CERTAIN SPECIFIED PUBLIC UTILITIES, PROVIDED THAT THE RATES OF INTEREST DO NOT EXCEED THE PERCENTAGE RATE SPECIFIED BY THE FINANCIAL SECRETARY, FROM TIME TO TIME, BY NOTICE IN THE GAZETTE.

HIS AUTHORITY TO SPECIFY THE RATE OF EXEMPTION IS IN TURN SUBJECT TO A CEILING SET IN THE ORDINANCE WHICH HAS, FOR MANY YEARS, BEEN VARIED TO ACCORD WITH THE RATE PAID BY BANKS ON SAVINGS ACCOUNTS.

SIR PHILIP POINTED OUT THAT IN MARCH THIS YEAR THE EXCHANGE BANKS' ASSOCIATION RAISED THE RATE OF INTEREST ON SAVINGS ACCOUNTS, AND ON CERTAIN OTHER DEPOSITS, FROM 9.25 PER CENT TO 10.5 PER CENT.

ACCORDINGLY, THE BILL IS INTENDED TO RAISE FROM 9.25 PER CENT TO 10.5 PER CENT THE CEILING ON THE FINANCIAL SECRETARY'S AUTHORITY TO SPECIFY THE RATE OF EXEMPTION, HE SAID.

DEBATE ON THE BILL WAS ADJOURNED.

REGIONAL ISATION OF SWD WORKS WELL

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REGIONALISATION OF THE SOCIAL WELFARE DEPARTMENT, INTRODUCED IN APRIL LAST YEAR, HAS WORKED WELL, THE DIRECTOR OF SOCIAL WELFARE, THE HON THOMAS LEE SAID TODAY.

REPLYING TO A QUESTION BY DR THE HON HO KAM-FAI IN THE LEGISLATIVE COUNCIL, MR LEE SAID THE REGIONALISATION SCHEME HAD BEEN CONSIDERABLY MORE SUCCESSFUL THAN MANY OF THE STAFF AFFECTED BY IT HAD EXPECTED BEFORE ITS INTRODUCTION.

THIS, HE SAID, HAS BECOME APPARENT DURING AN INTERNAL REVIEW STARTED THIS YEAR.

THE REVIEW WILL BE COMPLETED SHORTLY AND PROPOSALS FOR CHANGES, IF ANY, WILL BE CONSIDERED IN THE GOVERNMENT WITH A VIEW TO INTRODUCING THEM AS SOON AS POSSIBLE, HE ADDED.

MK LEE