XN000022-1997-03-12 — Page 57

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Overall rates to be reduced by 0.5 per cent

Delivering his Budget speech today (Wednesday), the Financial Secretary, Mr Donald Tsang, proposed that the overall rates percentage charge should be reduced from 5.5 per cent to 5 per cent, which is an historic low.

In the Urban Council area, the percentage for Urban Council rates would decrease from 2.8 per cent to 2.6 per cent and that for the general rates from 2.7 per cent to 2.4 per cent.

In the Regional Council area, the percentage for Regional Council rates would go down from 4.4 per cent to 4.2 per cent and that for the general rates from 1.1 per cent to 0.8 per cent.

After these adjustments, 28 per cent of ratepayers will pay the same or lower rates and about 59 per cent will face an increase of 20 per cent or less, he said.

But there would still be some who would face a relatively large increase in rates even after lowering the overall rates percentage charge.

"I propose to give these ratepayers some relief by imposing a 20 per cent cap on increases in rates for 1997/98 and for 1998/99. This relief will apply to about 13 per cent of ratepayers in 1997/98. In 1998/99, about 87 per cent of all properties will have no change in rates," Mr Tsang said.

The average increase in rates in 1997/98 for a small private flat would be only $29 per month - an increase of 8.8

per cent.

He told Legislative Council Members that the largest single group of tenants. those living in public rental housing, would not be affected directly by changes in rates. As in the past, the Housing Authority would absorb the effect of rates increases until the next rent review and public housing tenants, in practice, would be little affected because rents were revised only every two years and were fixed on the basis of affordability.

"As for the business sector, the average rates payment for non-domestic premises will, in overall terms, fall by 3.4 per cent. Industrial premises will enjoy the largest reduction, with an average 17 per cent cut in their rates bill. For offices, the reduction will be a useful 6 per cent on average," he said.