ENG-2004 — Page 101

The Economy 1 71

A duty is imposed on bets on horse racing administered by the Hong Kong Jockey Club, on proceeds of Mark Six lotteries and on gross profits of the Hong Kong Jockey Club's football betting operation. the only legal forms of betting in Hong Kong. The rate of duty on betting proceeds from horse-racing was 12 per cent on standard bets and 20 per cent on exotic bets in 2003-04. (The rate on exotic bets was increased from 19 to 20 per cent with effect from August 1 2003). The duty on football betting, which was introduced on August 1 2003, is charged at a rate of 50 per cent of gross profits. The yield from betting duty in 2003-04 totalled some $11.6 billion, and accounted for about 6 per cent of total revenue.

In 2003-04, estate duty was imposed on estates valued at over $7.5 million, at levels ranging from 5 per cent to a maximum of 15 per cent, while a hotel accommodation tax of 3 per cent was imposed on expenditure on accommodation by guests in hotels and guesthouses.

Under the Dutiable Commodities Ordinance, duties are levied on only four types of commodities - hydrocarbon oil, alcoholic beverages, other alcohol products (i.e. methyl and ethyl alcohol) and tobacco products, both locally manufactured and imported. The Customs and Excise Department is responsible for collecting these duties. In 2003-04, the department collected duties worth $6.4 billion or about 3 per cent of total revenue.

The Rating and Valuation Department is responsible for the billing and collection of rates, which are levied on landed properties at a specified percentage of their rateable value. In 2004-05, the rates percentage charge is 5 per cent.

The rateable value of a property is an estimate of its annual rent in the open market as at a designated date. In order to better reflect prevailing market rents, revaluation of rateable values is now conducted on an annual basis. The current Valuation List took effect on April 1, 2004 with rateable values reflecting rental values at October 1, 2003.

The Valuation List as at March 31, 2004 contained about 2 134 000 assessments. In 2003-04, the revenue from rates was $11.167 billion, accounting for about 5 per cent of total revenue.

The Rating and Valuation Department is also responsible for the billing and collection of Government rent, which is payable from July 1, 1997 for land leases granted on or after May 27, 1985, and on the extension of non-renewable land leases. The latter group comprises all land leases in the New Territories and New Kowloon north of Boundary Street which were renewed on June 28, 1997. Government rent is levied at 3 per cent of the rateable value of the lot and is adjusted in step with any subsequent changes in the rateable value. There were about 1 580 000 assessments in the Government Rent Roll as at March 31, 2004. The total Government rent collected in 2003-04 was $4.1 billion.

The Government derives significant amounts of revenue from other sources. Fees and charges for services provided by government departments generated about $10.5 billion, or about 5 per cent of total revenue, in 2003-04. It is government