XN000022-1988-04-20 — Page 33

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WEDNESDAY, APRIL 20, 1988

COMMITMENT ΤΟ

MR LI SAID THAT A FULL-SCALE SALES TAX WOULD BE REGRESSIVE TOTALLY CONTRADICTING THE GOVERNMENT'S SOCIAL EQUITY IN THE TAXATION SYSTEM.

OFT-REPEATED

TURNING TO OTHER TAXES, MR LI MAINTAINED THAT THE GOVERNMENT SHOULD MAKE THE INITIAL AND ANNUAL DEPRECIATION ALLOWANCES FOR MACHINERY AND EQUIPMENT INTERNATIONALLY COMPETITIVE, AND SHOULD ABOLISH THE WITHHOLDING TAX ON HONG KONG DOLLAR DEBT INSTRUMENTS, WHICH BLOCKED THE DEVELOPMENT OF A BROAD-BASED CAPITAL MARKET.

THE RECOMMENDATION THAT ANNUAL LICENCE FEES FOR BANKS AND DEPOSIT-TAKING COMPANIES BE INCREASED BY EIGHT PER CENT WAS "POTENTIALLY DANGEROUS AND CERTAINLY UNFAIR," AS THE LAST ROUND OF INCREASES FOR THESE FEES WAS ONLY TWO YEARS AGO.

SAID

URGING THE GOVERNMENT TO HELP THE FINANCIAL SECTOR, MR LI IT SHOULD TAKE A MORE SYMPATHETIC VIEW OF THE DEDUCTIBILITY AND THE METHOD OF EVALUATION OF LOANS BOOKED THROUGH HONG KONG.

IN SETTING TAX POLICY, THE ADMINISTRATION SHOULD ALSO CLOSER ATTENTION TO THE WISHES OF THE PEOPLE, HE SAID.

PAY

HE REGRETTED THAT THE QUESTION OF SEPARATE TAXATION FOR MARRIED COUPLES HAD BEEN STONEWALLED, TIME AND

AGAIN, AND THAT THE PRESENT SYSTEM DISCOURAGED MARRIED WOMEN FROM GOING TO WORK, AT A TIME WHEN HONG KONG NEEDED TO KEEP MARRIED WOMEN IN THE WORKFORCE.

"IT FALLS PARTICULARLY HARD ON THE MIDDLE CLASS

申中

PROPLE WE WANT TO STAY IN HONG KONG, HE SAID.

THE VERY

ΤΟ

MR LI SAID THAT HONG KONG NEEDED MORE THAN HALFWAY MEASURES PROMOTE HOME OWNERSHIP, FOR EXAMPLE BY MAKING MORTGAGE INTEREST TAX DEDUCTIBLE FOR HOME OWNERS.

ON EXPENDITURE, MR LI CALLED FOR A LIBERALISING OF THE SOCIAL SERVICE SUBVENTION SYSTEM, SAYING THAT THE GOVERNMENT'S SHORTSIGHTED APPROACH LIMITED THE QUALITY AND EXTENT OF THE SERVICES THAT VOLUNTARY AGENCIES COULD OFFER.

HE ALSO CALLED FOR MORE INVESTMENT IN HONG KONG'S HUMAN CAPITAL, IN VIEW OF THE BRAIN DRAIN THAT EXISTED.

"THE NEW HONG KONG UNIVERSITY OF SCIENCE AND THE OPEN LEARNING INSTITUTE ARE STEPS

IN THE RIGHT SAID.

TECHNOLOGY AND DIRECTION, HE

"

"BUT THE GOVERNMENT SHOULD NOT IGNORE THE IMPORTANCE OF ON-THE-JOB TRAINING, SUCH AS THAT BEING PROVIDED BY THE VOCATIONAL TRAINING COUNCIL AND THE HONG KONG MANAGEMENT ASSOCIATION.'

"SUCH PROGRAMMES DO MUCH TO FILL THE EXPERIENCE GAP CAUSED BY EMIGRATION AND IMPROVE OUR INDUSTRIAL COMPETITIVENESS."

MR 1.1 ALSO QUERIED THE PROPOSED FOUR PER CENT GROWTH SET FOR THE CIVIL SERVICE, AND ARGUED THAT A BIGGER CIVIL SERVICE WOULD AGGRAVATE AN ALREADY ACUTE LABOUR SHORTAGE AND HAVE A NEGATIVE IMPACT ON THE ECONOMY BY PUSHING UP SALARIES AND THUS FUELLING INFLATION.

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