TNAG-1725-FCO40-2438-Minutes-and-Hansards-of-the-Legislative-Council-of-Hong-Kong-1988 — Page 55

Property tax,

interest tax and profits tax paid by unincorporated businesses

97

76.5 per

cent

per ce reduction proposed in the standard rate from (61)

Taken

•15.5 per The to 15 will lower the yields from property tax, interest tax

1538 and profits tax paid by unincorporated businesses. together, I estimate that this will cost a further $70 million in 1988-89 and $160 million in a

full year. The new standard rate will apply to provisional and final profits

property tax assessments for 1988-89; it will apply also to final interest tax assessments for that year.

Nes

Stamp duty

98.

tax and

I have a further concession; it relates to stamp

duty. The concession is designed to facilitate wider home ownership and assist the middle income group. At present, the rate of duty payable on assignments varies according to the sale price or market value of the property, whichever is the higher. I intend to relax the rates applicable to small and medium-sized

properties.

99.

I propose with effect from 1 April 1988 to lift the

per cent threshold at which the 2.75 rate begins to apply from

756

the

present $500,000 to $1.5 million; to cut the rate of duty for properties costing between $250,000 and $1.5 million; and to introduce a new formula for determining marginal relief, which

will provide a greater benefit to duty payers and have the effect of pushing the various duty rate thresholds upward. I estimate that some 100,000 persons will benefit from these

proposals, which will cost a further $300 million in 1988-89. Details are given in an Appendix to the printed version of this

Speech (47).

(47) Appendix F(4).

45

/Air