TNAG-1728-FCO40-2441-Minutes-and-Hansards-of-the-Legislative-Council-of-Hong-Kong-1988 — Page 210

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(In Cantonese):

Sir, the 88/89 Budget has followed the

characteristics of the Budget of last year

in its prudence and steadiness, and has given rise to benefits for all walks of life, although

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in the matter of separate taxation the Budget does not fulfill the wishes of many people in

Hong Kong, such proposals as lowering the standard rate for salaries tax, increasing personal allowances, and lowering the stamp duty for the purchase of property should be very welcome measures. and for those reasons, I find the Budget basically acceptable. How- ever, there are a number of points for which we ought to consider further. The Financial Secretary has once again mentioned widening the tax base, and says that a study is on hand

exami to study the feasibility of imposing a sales

tax.

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The Financial Secretary pointed out

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that inintroducing any major new indirect tax, three criteria must be considered, they are: i) that it should produce a stable and worth- while revenue yield at low tax rate;, ii) it should cause minimal distortion to the economy; and ←

iii) that it should be simple and cheap to

administer.

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