1974 — Page 146

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HONG KONG URBAN COUNCIL

The second subject I would like to touch upon concerns the Food Hygiene Select Committee. I urge again that there be an early amend- ment to the Dutiable Commodities (Liquor) Regulations to enable the Council to issue Liquor Licences to be effective on the first day of the month which immediately follows the date that this Council has decided to grant the licence. With this amendment, this Council will be able to serve the public better, in that, whenever the Council deems proper that a licence should be granted it can be issued to the applicant peditiously. I would also like to see that members of the Select Com- mittee persue the suggestion of providing spaces for operation of inexpensive eating places wherever possible, and to utilize the area underneath the covered walk-way between Yau Ma Tei Ferry and Star Ferry when it is available to provide an economy eating area for those working in the Central area.

ex-

Mr. Chairman, I hope to be excused for now speaking on matters which are not within the scope of this Council.

I think the most pressing question today is how our government can raise sufficient revenue to meet our growing expenditure. We have already been told that very substantial deficits have been incurred in the first 9 months of the financial year. The situation is indeed serious.

In dealing with this problem, I will say at once that we must never resort to an increase in the rate of profits tax. My reason for saying this is simple. Hong Kong has been able to attract overseas investment and retain local investments mainly due to its simple and relatively low rate of taxation. Businesses are now at a slump and any increase in taxation must mean less profits and less attraction to both foreign and local investments. In a period of economic adversity, even America is reported to be planning a cut in income and corporate taxes to relieve its own economic recession. Hong Kong certainly should not do the opposite.

It is important that other means of raising revenue must be found because we must not cut our capital projects. Deferring the building of our capital projects must mean reducing opportunity for employ- ment for many. We cannot afford to have a problem of unemploy- ment specially with our present bad state of law and order when robbery is almost a common daily occurrence.

So what should we do to increase revenue? I would humbly suggest the following:--

1.

HONG KONG URBAN COUNCIL

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We all know that a substantial part of our revenue in the past had been derived from sales of crown land and premia for modification of lease conditions and exchanges to permit more intensive development of privately owned land. It is therefore important that the property market must be buoyant and real estate developers and those who buy properties for rental investment must be able to make reasonable profits. To maintain a healthy real estate market, Government's policies touching land must be flexible, and rent control laws must be realistic and in keeping with economic conditions. To relieve the present de- pression in the real estate market I agree with the suggestion of the leaders in that industry that Government's policy to charge rates on The burden of paying vacant properties must be scraped at once. rates on vacant property has deterred would-be purchasers of flats from buying for rental investment purpose. The obvious reason is that there is a plentiful supply of residential as well as non-domestic premises at the moment, thus renting out premises is not an easy task. One just has to read the advertisement columns of our newspapers to find this out. Obviously a purchaser would not like to be saddled with the burden of paying rates for his investment at a time when no im- mediate income can be derived therefrom. Therefore, this inequitable levy of rates on vacant properties must forthwith be abolished.

The series of landlord and tenant legislation applicable to domestic premises promulgated on and off from 1963 to 1973 have not been conducive to the development of the real estate industry.

Whilst I can see the reason at a given time that tenants of small flats should be afforded security of tenure and protected from un- reasonable demands of their landlords, I do not see the logic of legisla- tion which protects even wealthy and well-to-do tenants occupying luxurious-domestic flats. According to our present legislation, these tenants are protected along with small tenants until December 1976.

Rent control can never be the answer to a housing shortage. In fact, rent control works the opposite way and creates a housing short- age. It also creates slums if allowed to remain long enough.

I urge that having regard to the present state of supply of domestic accommodation an early decision by government that tenants occupying domestic premises having a rateable value at 5.3.1970 of $15,000.00 or above must cease to enjoy protection. This is not a novel suggestion but merely my recommendation that we revert to the law applicable to such premises prior to December 1973.