TNAG-1728-FCO40-2441-Minutes-and-Hansards-of-the-Legislative-Council-of-Hong-Kong-1988 — Page 166

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Taxation can

taxpayer will lose, especially if a spouse is not working. Many countries adopting separate taxation do not allow for option. Solutions, however, can be found after careful consideration. never be totally fair, but every effort should be made to make it reasonable and fair. I I am pleased to note that the Financial Secretary is aware of the trend in some other tax administrations in the

direction collection of separate taxation for married women. He must have a crystal ball as that is exactly what the Chancellor of the Exchequer,

linited Kingdom for Mr. Nigel Lawson, proposed in the recent UK Budget

United Kingdom 10 [Let

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1988-89. me quote some statements from the Financial Statement and Budget for 1988-89: The present system of taxing husbands and wives, under which a married woman's income is treated in law as if it belonged to her husband, has been unchanged since the early days of income tax.

eve

The

This is general agreement that the present law is no longer acceptable longer acceptable and wide support for an early change to a new and more uptodate system. A major reform is therefore proposed to give husbands and wives independence and privacy in their tax affairs and remove the tax penalties on marriage which can occur under the present system. new system will be introduced from 6th April 1990, to allow time for the necessary preparation. The Chancellor of the Exchequer's proposal for independent taxation for married couples ought to give us a good example. May I add that the question of transferability of allowances

insuperable and tax avoidance are not insurmountable problems or justifiable excuses for further delays. Our tax system is simple. have complicated problems of capita

gains tax, investment income and so

A limited kingdom. etc., which exist in the UK.

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Furthermore, I hope that efficient as we

We do not

are in Hong Kong, we can introduce separate taxation preferably in 1989-90 if at all possible. If consultation is required, I am sure

OMELCO Taxation

that the UMELCO Tax Panel, various professional bodies and others concerned will be only too pleased to assist in suggesting

and

The

separate taxation for working wives may best be introduced. additional administrative cost estimated at $17 million in the 1987-89

between the Budget, when the difference in cost of introducing separate taxation,

and which is estimated at $400 million in 1987-88 Budget, against the proposed $340 million Working Wife Allowance concession, is perhaps not

treatment too high a price to pay to remedy an inferior tax trick "To be fair,

onu

MUNANASIASATAWAN