XN000022-1996-04-17 — Page 3

2 -

The Business Registration (Amendment) Bill 1996 seeks to increase the maximum average monthly turnover level below which businesses are exempt from business registration fees. For sale of goods, the level is increased by 100% to $30,000, and for sale of services, it is increased by 150% to $10,000.

The Estate Duty (Amendment) Bill 1996 seeks to raise the exemption level of estate duty from $6 million to $6.5 million and widen the band widths of the two marginal duty rates from $1 million to $1.5 million.

The Stamp Duty (Amendment) Bill 1996 seeks to adjust stamp duty rates on property transactions to bring relief to home buyers of flats with value up to $3.5 million.

The Motor Vehicles (First Registration Tax)(Amendment) Bill 1996 aims to plug the tax loophole whereby some motor vehicle dealers manipulate their first registration tax liability by artificially suppressing the retail price of the standard motor vehicle and over-declaring the value of tax exempted items like vehicle accessories and distributor's warranties. Besides, the Bill also provides sanctions against abuse to obtain first registration tax remission, which are essential to the implementation of the scrapping incentive scheme for the replacement of private vehicles of ten or more years old, as announced in the Budget.

The Air Passenger Departure Tax (Amendment) Bill 1996 seeks to increase the air passenger departure tax from $50 to $100.

The Betting Duty (Amendment) Bill 1996 seeks to increase the betting duty rate from 11.5% to 12% for standard bets and 17.5% to 18% for exotic bets. The increase will be offset by a corresponding reduction in the betting commission of the Royal Hong Kong Jockey Club. The prize money pool will not be affected. The increase will take effect from September 1996.

The Dutiable Commodities (Amendment) (No. 2) Bill 1996 seeks to increase tobacco and fuel duty by 9% which is broadly in line with inflation.

The increase on tobacco and fuel duty came into effect on March 6, and the proposals in respect of air passenger departure tax, estate duty, stamp duty on property transactions and business registration fees took effect on April 1 under Public Revenue Protection Orders signed by the Governor on March 5. The Orders are valid for four months.