TNAG-1858-FCO40-2633-Legislative-Council-of-Hong-Kong-memoranda-and-minutes-of-me-1989 — Page 161

HONG KONG LEGISLATIVE COUNCIL

19 July 1989

香港立法局 ——————一九八九年七月十九日

48

In these circumstances, I cannot see the justification of the Bill.

The real tax impact of the changes proposed has not been fully explained. Also, the financial impact of the Bill is not well understood in terms of added costs. In summary:

the tax burden of higher income families (those paying the standard rate) will remain the same as at present;

the tax burden of middle income families will be reduced, as the new benefits to them will exceed the ones they lose;

however, the tax burden on the lower income families (those earning less than approximately $150,000 per year) will be heavier, as a result of the new benefits falling short of those that will be lost by the cancellation of the working wife allowance;

the net tax revenue to Hong Kong will be reduced significantly by the added costs to the Inland Revenue Department because of the need to handle a massive increase in the number of salaries tax returns to be processed (an increase of roughly 200 000 or 25% in the number of returns).

Would people really support the introduction of this Bill if they realized that its effect would be to increase the tax burden on the majority of families, especially on those with lower incomes?

Would people really support it if they realized that its effect is just to provide a means for adjusting one very minor aspect of the financial rights of wives in relation to the family unit? Even if they wanted to, for social purposes ....and I do not think they do....., would people want it if they knew its introduction would significantly increase the cost of the tax administration?

Would the 200 000 married women who are the supposed beneficiaries want it, if they knew that they would have to prepare their own tax returns to get the supposed benefit? Would they want it if they knew that in the process, the majority of family units would end up paying more taxes than they pay today?

Should we support this Bill? I personally cannot justify it. I consider it to be an attempt to solve a tax problem that no longer exists. It is an attempt to establish separate and generally immaterial rights for married women, that are not being sought by these women.