XN000022-1986-01-29 — Page 15

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WEDNESDAY, JANUARY 29, 1986

+OVERALL, THE IMAGE OF WAN CHAI IS CHANGING BEARING IN MIND THE DEVELOPMENT OF OLD SITES INTO HIGH-RISE COMMERCIAL AND RESIDENTIAL BLOCKS AND THE EXTENSIVE DEVELOPMENT OF THE WAN CHAI RECLAMATION, HE SAID.

+ THE INCREASE OF NEW COMMERCIAL AND CULTURAL COMPLEXES, FOR EXAMPLE, THE HONG KONG CONVENTION AND EXHIBITION CENTRE, THE ACADEMY FOR PERFORMING ARTS, HONG KONG ARTS CENTRE, ETC., IS GIVING THE DISTRICT A MORE POLISHED IMAGE, HE ADDED.

APPROVAL SEEN IN REVENUE PROPOSALS

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CHANGES INCORPORATED INTO THE INLAND REVENUE (AMENDMENT) BILL 1986, TAKING INTO ACCOUNT RECOMMENDATIONS BY THE UMELCO REVIEW PANEL, WOULD MEET WITH THE APPROVAL OF ALL RESPONSIBLE MEMBERS OF THE BUSINESS COMMUNITY IN PARTICULAR, AND OF THE GENERAL PUBLIC AT LARGE, THE FINANCIAL SECRETARY, SIR JOHN BREMRIDGE, SAID TODAY.

MOVING THE SECOND READING OF THE BILL, SIR JOHN SAID THAT IT DIFFERED IN MANY RESPECTS FROM THE DRAFT BILL PUBLISHED IN JULY LAST YEAR WHICH CONTAINED A NUMBER OF PROPOSALS MADE IN HIS 1985 BUDGET SPEECH.

THESE PROPOSALS HAD SINCE BEEN SUBJECTED TO CLOSE SCRUTINY BY THE UMELCO AD-HOC INLAND REVENUE REVIEW PANEL WHICH HAD RECEIVED A LARGE NUMBER OF REPRESENTATIONS FROM INTERESTED PERSONS AND INSTITUTIONS.

THE ALTERATIONS TO THE EARLIER DRAFT BILL, HE SAID, RETAINED THE OVERALL PHILOSOPHY OF HIS BUDGET PROPOSALS.

SIR JOHN SAID THAT IN VIEW OF BOTH THE DETAILED EXAMINATION WHICH HAD BEEN MADE OF THE PROPOSALS CONTAINED IN THE BILL. AND OF THE INFORMATION ALREADY PROVIDED TO MEMBERS, HE DID NOT INTEND TO EXPAND FURTHER ON THEM.

BUT, REFERRING TO THE 1984 AMENDMENTS WHICH HAD BROUGHT INTO THE CHARGE TO PROFITS TAX SO CALLED +OFF SHORE+ INTEREST INCOME SIR JOHN SAID THIS MATTER HAD BEEN INCLUDED IN THE TERMS OF REFERENCE OF THE UMELCO REVIEW PANEL.

SIR JOHN SAID: +ON THIS POINT THEY CONCLUDED THAT THE 1984 AMENDMENTS HAVE ERODED HONG KONG'S BASIC TAX PHILOSOPHY AND HAVE BREACHED THE TERRITORIAL SOURCE CRITERION.

+ HAVE GIVEN CAREFUL CONSIDERATION TO THE FINDINGS OF THE PANEL AND HAVE HELD USEFUL DISCUSSIONS ON THIS DIFFICULT ISSUE.

/+I STILL