XN000022-1995-11-29 — Page 57

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Personal allowance for salary tax

Following is a question by the Hon Eric Li Ka-cheung and a written reply by the acting Secretary for the Treasury, Mr Alan Lai, in the Legislative Council today (Wednesday):

Question:

In view of the concern expressed by this Council over the amount of personal allowance for salaries tax, will the Government inform this Council whether, on the basis of the number of taxpayers in 1995-96, it has estimated the respective numbers of persons who will fall out of the tax net if the amount of basic personal allowance for both individuals and married couples is to be raised by 5%, 10%, 15%, 20% or 25%; if so, what are the respective numbers of taxpayers remaining and what are the respective percentages out of the working population of nearly 3 million people: if not, why not?

Answer:

Based on a working population of roughly 3 million people in 1995-96, our estimate of the number of taxpayers who would fall out of the tax net if the amount of single person and married person allowance were increased by 5%, 10%, 15%, 20% or 25%, and the number of taxpayers who would then remain in the tax net, is broadly as follows:

Increase in basic personal allowance

Remaining taxpayers

Number of taxpayers who will drop

Number

out of tax net

Percentage of working population

5%

76,000

1,324,000

44%

10%

150,000

1,250,000

42%

15%

221,000

1,179,000

39%

20%

287,000

1,113,000

37%

25%

350,000

1,050,000

35%

End/Wednesday, November 29, 1995