TNAG-2472-FCO40-3599-Confidential-talks-between-the-UK-and-China-regarding-financ-1992 — Page 33

Paper 6 (P.7 of 13)

14-OCT-1992

12:02

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+ 852 868 5279

P.31

7

し

4. Stamp duty

-

Table D

exceeded

shows that actual yield from stamp duty

the revised estimate by $670 million or 7.5% in 1991-92. The deviation was the largest

in the last five years.

The whole of this increase was due to increased receipts in March 1992 as a result partly of increased stock market turnover and partly of increased level of stamping of

followed

the

greatly

property

designed

to

curb

property

market.

which documents

speculation Neither of these developments

a

in

measure

the domestic

could reasonably have been anticipated.

(111) Control of 'growth'

Given the budgetary

rate

the growth

expenditure

guideline

of maintaining

public

in real terms of

in line with the trend GDP growth

and that the price expenditure public

rate

convert

generally

rises

convert

GDP (i.e.

faster

deflator

used

to

to nominal terms

than that used to

the

GDP deflator), public

expenditure will grow at a faster rate than GDP

in nominal terms.

There is then a choice on

the criteria to control 'growth' :

(i)

to

match the growth rate in nominal terms that of the of public

GDP

expenditure with

as to maintain a steady size of the public sector. This has the effect of reducing the growth rate in real terms to below that of

of public expenditure

the trend GDP growth rate; or