XN000022-1993-03-04 — Page 16

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THURSDAY, MARCH 4, 1993

FS: ABSOLUTELY NOT. I MEAN NORMALLY I'M CRITICISED FOR THE REVERSE, FOR BEING TOO CAUTIOUS AND TOO PRUDENT SO IT'S A DELIGHTFUL CHANGE TO BE ACCUSED OF SPENDING TOO MUCH MONEY, BUT WHAT I'VE TRIED TO REASSURE PEOPLE IS THAT WE ARE KEEPING CONTROL OF RECURRENT EXPENDITURE. WE ARE KEEPING RECURRENT EXPENDITURE TO A GROWTH OF 5 PER CENT A YEAR. I THINK THAT'S WHAT PEOPLE WANT TO KNOW. WE HAVE MORE SCOPE ON NON- RECURRENT, ON CAPITAL EXPENDITURE, WHICH AFTER ALL HAS A FINITE END TO

IT.

CHAN:

I THINK WE'RE ALL FAMILIAR ABOUT THE EXPENDITURE

NOW WE HAVE A CALLER, MR CHOY, GOOD MORNING.

ESTIMATES.

QUESTION: GOOD MORNING. I HAVE THREE POINTS TO MAKE AND I HOPE THE FINANCIAL SECRETARY WILL RESPOND TO IT.

CHAN: PLEASE DO IT POINT BY POINT.

THE

QUESTION:

O.K. FIRST POINT, ABOUT THE TAX ALLOWANCES. NOW IT'S BEEN INCREASED FROM $46,000 TO $56,000 BUT USUALLY THAT MEANS IF YOU HAVE AN AVERAGE WAGES OF $5,000 A MONTH YOU WOULD BE INCLUDED IN TAX NET AND I'M NOT HAPPY ABOUT THAT BECAUSE LAST YEAR WE HAVE ASKED FOR RAISING THE TAX ALLOWANCE TO $75,000, SO WHY SUCH A SMALL INCREASE, WE ARE RATHER DISAPPOINTED AND WE CAN FEEL THE PRESSURE ON

US?

CHAN: SO THE FIRST QUESTION IS ABOUT THE TAX ALLOWANCE BEING RAISED FROM $46,000 AND THE INCREASES, THE DISAPPOINTMENT, MR MACLEOD.

COST IT'S

THE

YOU

FS: WELL I'M RATHER AMAZED TO HEAR IT DESCRIBED AS A SMALL INCREASE. I THINK YOU HAVE TO REMEMBER TO LOOK AT NOT JUST WHAT HAPPENS TO THE TAX ALLOWANCE OR WHAT HAPPENS TO THE TAX BANDS AND WHAT HAPPENS TO THE OTHER ALLOWANCES AND THE COMBINED EFFECT OF THOSE CONCESSIONS IS THAT THE COST OF THOSE CONCESSIONS IS THREE TIMES WHAT IT WOULD HAVE TO GIVE A SIMPLE INFLATION INCREASE IN THE TAX ALLOWANCE, SO THREE TIMES WHAT WOULD BE NECESSARY TO KEEP UP WITH INFLATION AND EFFECT ON THE NORMAL FAMILY IS ACTUALLY RATHER SIGNIFICANT. PROBABLY KNOW ALREADY THAT MORE THAN HALF THE WORKING POPULATION NO SALARIES TAX WHATSOEVER BUT THE EFFECT OF THE CHANGES IS THAT WHAT'S CALLED A SANDWICH CLASS FAMILY EARNING $18,000 A MONTH, A MARRIED COUPLE WITH TWO CHILDREN, THEIR TAX BILL WILL BE CUT BY OVER 50 PER CENT, I DON'T CALL THAT A SMALL CHANGE. I THINK IT'S A VERY SIGNIFICANT CHANGE, I DON'T RECALL SUCH TAX CUTS FOR MANY YEARS IN THE PAST, I THINK IT'S WELCOMED BY MOST PEOPLE.

CHAN:

MR CHOY YOUR SECOND QUESTION.

QUESTION: HAPPY.

PAY

A,

NOW I THINK I WILL STILL RESPOND TO FS, I'M NOT STILL ANYWAY THE SECOND POINT, NOW I SEE THAT THE FS IS TRYING VERY HARD TO CONTROL SPECULATION ACTIVITIES BUT STILL THERE IS NO SIGN OF A CAPITAL GAINS TAX COMING IN BECAUSE THAT CAN HELP TO CURB SPECULATION, WHY NOT?

/FS