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whether the market can have an atmosphere that makes the customers keep coming back, and whether the terms given to the market stall holder or supermarket operator are attractive enough, all these points determine the shopping habit of the general public. And the above points are dependent upon whether terms given to the market stall holders or supermarket operators are attractive enough to attract enough operators in different varieties of goods to open business at the conveniently located market place, so that they can still have a reasonable profit margin when they're selling their goods at a price acceptable to their customers. I rather see all our market stalls all occupied by operators paying only a nominal sum of rent but doing what they're supposed to do, and patronized by the general public than some stall holders paying a high rent to us, but may be using the stall only for storage purposes and having their goods sold on the street. The difficult task of changing the general public's shopping habits requires many government departments' involvement.

The Housing Department, when planning their housing estate, should provide more convenient locations for such markets and offer very favourable terms, such as lower rentals to operators. The Building and Lands Department, in planning the usage of land, should also be aware of the hawker problem, try their best to allocate more convenient locations for the installation of markets and supermarkets. The Education Department can, through their schools, educate students not to buy from illegal hawkers, to let them know the damage and effect hawkers can have on the community. The Police and Urban Service Department should tighten their pressure on street hawkers so that they can be forced into the markets. Also, the Urban Council can encourage more people to open supermarkets by means of rent subsidies. It sounds crazy to subsidize a supermarket's rent, but if more supermarkets are open, that means fewer UC market complexes are needed, and we can save a lot of money on the construction, operation, and maintenance of UC markets. Furthermore, if the number of hawkers on the street is greatly reduced, that also means that our expenditure on hawker control can also be reduced.

With these remarks, Mr. Chairman, I support your motion.

(Miss Cecilia YEUNG left the meeting at 3:44 p.m.)

MISS VICTORIA Y. CHAN (in English): Mr. Chairman, Hong Kong has done very well in the last few years and has amassed regular budget surpluses with the prospects of another huge surplus for this current year in the region of $10 billion, some 80% over the official projection of $5.5 billion. There was a surplus of $13.5 billion for the year 1987-88 and a comparatively lesser surplus of $1.2 billion for the year before, that is, the financial year of 1986-87. The Government would have culminated at least $24 billion in surpluses over 3 years by the end of March 1989.

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Hong Kong has indeed enjoyed an economy that has been expanding rapidly, and the Government is, so to speak, laughing all the way to the bank. No doubt, the administration will use its best endeavours to put to good use the extra funds it has in hand, and schemes relating to environmental protection and ambitious infrastructure developments, including the possibility of a new airport, are brought to mind. The public at large will benefit in the long term by these schemes, and certainly, they are necessities for a modern complex society like Hong Kong, and such multi-dollar schemes will enhance the prosperity of Hong Kong. However, in order that there be prosperity, the society needs stability, and to this end, the Government should look more closely into the basic needs and well-being of the majority of the public here, the majority that forms the backbone of the society, the ordinary man in the street, the labourers and the factory workers who, together with management, run the industries in Hong Kong; the white-collar workers who run the offices, the clerks in the civil service who help run the administration, and the small businessmen. We also owe the economic growth of our society to these people, and with an enormous surplus like the one the Government presently enjoys, the Government should give these people preferential consideration in the coming financial year and directly benefit them with the surpluses.

The Government is well placed to further reduce personal taxation in the next budget by raising the personal allowance from the existing 40% and further lowering the present 15.5% in respect of salaries tax. By this, many households in Hong Kong will benefit. Company taxation should, however, be maintained at its present level. Corporations are already enjoying some of the lowest rates in the industrial world. Certainly, increased corporate or company taxation has the effect of discouraging capital investment, but there is little advantage for the Government to further reduce profits taxation, as the taxation environment in Hong Kong is already extremely beneficial to corporate taxpayers.

On the other hand, I would like to suggest to Mr. Financial Secretary that he consider tax concessions tailored for small businesses as an encouragement to entrepreneurs by providing a sliding tax scale based on the profits made, with the top scale at the existing level of taxation.

In the current economic climate, the Government should shelve its proposal for a general sales tax. Such a tax will invariably increase the cost of living in Hong Kong, as it will be levied indiscriminately on necessities as well as luxury items. If one would only care to look into the employment advertisements in the newspapers, one would realise that the majority of the people here earn less than $5,000.00 per month. Be it in airline, hotel, or other big organizations, where with qualification, personality, and experience, the average pay offered for most jobs is about $4,000.00 per month only for clerical staff. With the high standard of living in Hong Kong, such an income level hardly makes ends meet, and the extra burden of sales tax will cause hardship to people in this income bracket. Why, then, cannot the Government focus on an increase