100.
These proposals will cost $850 million in 1992-93, or $1.2 billion in a full year. They will cut the tax bill for 1.2 million taxpayers (83% of the total). A further 120,000 (8% of the total) will be freed completely from paying any salaries tax.
101.
Details of these concessions, and examples of their effects upon various categories of taxpayer, are set out in the Supplement to this Speech. They will take effect from the year of assessment commencing 1 April 1992.
Duty on Soft Drinks
7
102. Duty on soft drinks was introduced in 1985 as a revenue raising measure. I propose to abolish it with effect from this afternoon. This concession will cost the revenue about $230 million a year. I have taken steps which should ensure that the full benefit is passed on to consumers. I have told the soft drinks industry that we expect no price increases for at least twelve months or, where increases were introduced this year, a price reduction to reflect fully the abolition of the duty. The industry's representative association in Hong Kong has undertaken to persuade its members to do so. As a result, there should be a small but beneficial effect on the Consumer Price Indices.
Entertainments Tax on Cinema Tickets
103. Entertainments tax is levied under the Entertainments Tax Ordinance introduced over 60 years ago in response to the new-fangled "cinematographic exhibitions" of the time. The provisions relating to cinemas are now outdated and arguably put cinemas at an unfair disadvantage when compared with home entertainment.
104. I propose to abolish the tax in respect of cinema tickets with effect from 1 April this year. The tax now accounts for roughly 10% of the cost of a normal cinema ticket. The abolition should therefore help to keep down the cost of this popular form of entertainment. It should also have a useful, if minor, impact on the Consumer Price Indices. The cost to the revenue will be only $130 million a year. I have received assurances from Hong Kong's two largest cinema operators that the full benefit of this concession will be passed on to cinema-goers and that there will be no increase in the price of tickets in the coming year.
Duty on Diesel Oil
105.
At present, franchised bus companies receive a refund of 65 cents a litre on duty paid for diesel oil. I propose to exempt the companies completely from the duty on diesel fuel, with effect from this afternoon. This concession will be fully reflected in future adjustments to bus fares. This proposal will cost $190 million a year and, again, will help to combat inflation.
Stamp Duty on Stock Transfers
106.
My final proposed concession relates to stamp duty. Last year, in recognition of the world-wide trend towards eliminating the duty on stock transfers, overall contract note duty was lowered from 0.6% to 0.5%. This year, I propose to continue this process
21
No comments yet.
Private notes are available after approval.