XN000022-1988-11-03 — Page 2

THURSDAY, NOVEMBER 3, 1988

FS: WORKING PAPER NEXT YEAR ON SALES TAX PROPOSALS

THE GOVERNMENT INTENDS TO PRODUCE A WORKING PAPER EARLY

PUBLIC YEAR AND START CONSULTING THE

ON SALES TAX PROPOSALS, FINANCIAL SECRETARY, MR PIERS JACOBS, SAID TODAY (THURSDAY).

NEXT

THE

PUBLIC

AWARENESS

IN

DIVERSIFICATION THAT THIS

ΤΟ

AWARENESS

SPEAKING AT A LUNCHEON MEETING OF THE KOWLOON ROTARY CLUB, MR

GROWING JACOBS POINTED OUT THAT THERE HAD BEEN RECENT MONTHS OF THE POTENTIAL IMPORTANCE OF TAX THE ECONOMY, AND HE WELCOMED THE PUBLIC HAD GENERATED.

DEBATE

HE SAID THE ADMINISTRATION HAD RECENTLY BEEN EXAMINING IN

WAS BUT HE DETAIL THE NATURE AND SCOPE OF A POSSIBLE SALES TAX

CERTAINLY NOT PROPOSING TO INTRODUCE IT IN THE IMMEDIATE FUTURE, HIS 1989 BUDGET.

SOME NOT IN

A

TIMETABLE.

BUT

"IN FACT, AT THIS STAGE 1 AM NOT WORKING TO WHAT I AM DOING IS ENDEAVOURING ΤΟ GENERATF SOME INTELLIGENT

DESPITE THE COMPLEXITY OF DISCUSSION ON THIS SUBJECT; INVOLVED I AM ENCOURAGED BY THE THOUGHTFUL RESPONSES SO FAR,

THE ISSUES

++

HE SAID.

VIEWS BY LIKELY TO

HE SAID IT WAS HIS INTENTION TO START SEEKING PUBLIC APPROACHING A NUMBER OF ORGANISATIONS AND BODIES THAT WERE BE IN A POSITION TO ENGAGE IN DETAILED DEBATE ON THE PROPOSALS.

"DEPENDING ON HOW WE PROGRESS. I SHALL THEN BE IN A POSITION

NOT ΤΟ OR TO DECIDE WHETHER

TAKE MORE

PROPOSALS TO EXECUTIVE COUNCIL, HE ADDED

FORMAL

THE

HE EXPLAINED

THAT THE OBJECT

OF A SHIFT FROM

TO DIRECT

OF A MORE INDIRECT TAXES WAS THE DEVELOPMENT

STABLE REVENUE BASE TO WHICH WOULD BE LESS VULNERABLE TO ECONOMIC CYCLES, AND BETTER ABLE

AND MEET

SUSTAIN FXPENDITURE ON A RANGE OF

FUNDED

PROGRAMMES AND SERVICES.

GOVERNMENT

ONLY ONE HE SAID THE TAX BASE IN HONG KONG WAS VERY NARROW AS

PAID SALARIES TAX WHILE IN FOUR OF THE LABOUR FORCE

ABOUT 50,000 TAXPAYERS PROVIDED OVER 50 PER CENT OF THE SALARIES TAX REVENUE.

TOP 30 TOGETHER WOULD

SOME 20 PER CENT OF PROFITS TAX REVENUE WAS MET BY THE COMPANIES AND THIS YEAR, SALARIES TAX AND PROFITS TAX ACCOUNT FOR NEARLY HALF OF GENERAL REVENUE. HE ADDED.

TO SWEEP ASIDE THE NEED TO BROADEN THE TAX BASIC ECONOMIC REALITIES, MR JACOBS SAID,

"IN HONG KONG, WE ARE ALMOST BOUND TO IN THE BUSINESS CYCLE THAN IN THE PAST.

BASE WAS IGNORING

SEE

GREATER VOLATILITY

"WITH THAT