XN000022-1989-05-10 — Page 10

WEDNESDAY, MAY 10, 1989

"THE GROWTH OF PUBLIC EXPENDITURE WILL HAVE TO BE MONITORED CAREFULLY, AND DIFFICULT CHOICES MADE, IF GROWTH IS TO BE CONTAINED WITHIN THE BUDGETARY GUIDELINES," HE SAID.

ON THE SUGGESTION THAT PUBLIC EXPENDITURE SHOULD NOT BE RESTRAINED BY ARBITRARY GUIDELINES, MR JACOBS SAID AS HE HAD EXPLAINED THESE WERE MERELY GUIDELINES.

"I ACCEPT THAT THERE CAN BE OCCASIONS WHEN WE MIGHT NEED то STEP OUTSIDE THEM, BUT ONLY FOR A LIMITED PERIOD.

"WE NEED SOME YARDSTICKS IF WE ARE ΤΟ CONTAIN EXPENDITURE, THE FINANCIAL SECRETARY SAID.

PUBLIC

IMPORTANCE OF HAVING MORE STABLE REVENUE BASE

ENSURE

THAT THE

HONG KONG MUST HAVE A MORE STABLE REVENUE BASE TO ITS DEVELOPMENT PROGRAMMES CAN BE IMPLEMENTED WITHOUT DISRUPTION,

SAID IN THE LEGISLATIVE FINANCIAL SECRETARY, THE HON PIERS JACOBS, COUNCIL TODAY (WEDNESDAY).

OVER A

OF

HE SAID THAT IF THE REVENUE YIELD WERE TO DROP SHARPLY NUMBER OF YEARS AS A RESULT OF A SLACKENING ECONOMY, THE PROGRAMME PUBLIC SERVICES WOULD BE PLACED IN JEOPARDY.

READING OF THE

WAS

IN HIS SPEECH WINDING UP DEBATE ON THE SECOND APPROPRIATION BILL 1989, MR JACOBS SAID THAT FROM TIME TO TIME IT INEVITABLE THAT THE ECONOMY WOULD TURN DOWN,

"WHEN IT DOES SO, THIS IS BOUND TO HAVE AS IT IS ON DIRECT OUR REVENUE, DEPENDENT BUSINESS PROFITS TAX," HE SAID.

-

A SERIOUS EFFECT ON PARTICULAR TAXES, IN

THAT IS WHAT THEY ARE HEAVY PROGRAMME INFRASTRUCTURE,

VERY THE

"YES, WE CAN DRAW DOWN OUR RESERVES THERE FOR BUT AS 1 HAVE INDICATED, WE HAVE A OF PUBLIC

IN

то RELATION EXPENDITURE ENVIRONMENTAL PROTECTION AND SO ON,

+

WITHOUT

"TO ENSURE THAT WE CAN IMPLEMENT OUR PROGRAMMES

BASE, HE SAID WHEN DISRUPTION, WE MUST HAVE A MORE STABLE REVENUE REFERRING TO THE POSSIBLE INTRODUCTION OF A SALES, OR WHOLESALE, TAX.

POSSIBLE MR JACOBS SAID MANY MEMBERS HAD RIGHTLY WARNED OF THE

MEMBERS OF THE ADVERSE EFFECT OF A SALES TAX ON THE LESS WELL TO DO COMMUNITY.

"I AGREE THAT THIS IS CLEARLY AN IMPORTANT ASPECT THAT WE TAKE INTO ACCOUNT," HE SAID.

MUST

BUT HE ....

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