ENG-2010 — Page 109

The Economy | 67

To alleviate people's burdens in the aftermath of the financial tsunami, the Government waived rates for the four quarters from April 2010 to March 2011, subject to a ceiling of $1,500 per quarter for each rateable tenement. As a result, about 85 per cent of ratepayers were not required to pay any rates, while the remaining 15 per cent of ratepayers had their rates bills reduced by the full concession amount of $1,500, costing the Government about $8.6 billion.

The Rating and Valuation Department is also responsible for the billing and collection of Government rent for properties held under land leases granted on or after May 27, 1985, or on the extension of non-renewable land leases. Government rent is levied at 3 per cent of the rateable value of the property and is adjusted in step with any subsequent changes in the rateable value. There were about 1.8 million assessments in the Government Rent Roll on March 31, 2010. Total Government rent collected in 2009-10 was $5.9 billion, or about 2 per cent of total

revenue.

Fees and charges for services provided by government departments generated about $10.5 billion, or about 3 per cent of total revenue, in 2009-10. It is government policy that fees, in general, should be set at levels sufficient to recover the full cost of providing the services. Certain essential services are, however, subsidised by the Government or provided free of charge. Government-operated public utilities generated about $3.4 billion, which accounted for about 1 per cent of total revenue; the most important of these, in revenue terms, is provision of water supplies.

The Government also collected $33.6 billion from investments and interest income on the fiscal reserves in 2009-10, amounting to about 11 per cent of the total revenue.

Lastly, some $39.6 billion, or about 12 per cent of the total revenue in 2009- 10, was generated from land transactions. All revenue from land transactions is credited to the Capital Works Reserve Fund to help finance the Public Works Programme.

Network of Agreements for Avoidance of Double Taxation

Comprehensive agreements for the avoidance of double taxation (CDTAs) with major economies help improve the business environment and facilitate flows of trade, investment and talent between Hong Kong and the rest of the world. They help reduce tax burdens on individuals and enterprises and eliminate uncertainties over tax liabilities. They also enhance Hong Kong's position as an international business and financial centre.

To expand further Hong Kong's network of CDTAs, the HKSAR Government liberalised arrangements for exchanging tax information under the CDTAs to correspond with international standards. The liberalised arrangements came into force on March 12, 2010, following which Hong Kong signed 13 CDTAs applying the new standards.