ENG-2017 — Page 96

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The Economy

Club. The yield from betting duty in 2016-17 totalled some $21.1 billion, about 4 per cent of total government 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 values (5 per cent in 2017-18). The rateable value of a property is an estimate of its annual open market rent at a designated date. Rateable values are reviewed each year to better reflect prevailing market rents. The current Valuation List, containing about 2.5 million assessments, took effect on 1 April 2017, with rateable values reflecting rental values on 1 October 2016. The revenue from rates in 2016-17 was $21.3 billion, or about 4 per cent of total government revenue.

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 27 May 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 1.9 million assessments in the Government Rent Roll on 1 April 2017. Total government rent collected in 2016-17 was $10.7 billion, or 2 per cent of total government revenue.

Under the Dutiable Commodities Ordinance, excise duties are levied on four commodities to be consumed locally, namely hydrocarbon oil, liquor, methyl alcohol and tobacco, irrespective of whether they are manufactured locally or imported. The Customs and Excise Department collects these duties, which totalled $10.3 billion in 2016-17, or about 2 per cent of total government revenue, of which 58.3 per cent was from tobacco, 37.2 per cent was from hydrocarbon oil, 4.4 per cent was from liquor, and 0.1 per cent was from methyl alcohol and other alcohol products.

All motor vehicles imported for use on roads are subject to First Registration Tax under the Motor Vehicles (First Registration Tax) Ordinance. The Customs and Excise Department assesses the taxable value of vehicles to facilitate the Transport Department's collection of this tax, which totalled $7.8 billion in 2016-17, or 1.4 per cent of total government revenue.

It is government policy that fees charged by the government should in general be set at levels adequate to recover the full cost of providing the goods or services. Certain essential services are subsidised by the government or provided free of charge. Fees and charges for goods and services provided by the government generated about $12.7 billion, or about 2 per cent of total revenue, in 2016-17. Government-operated public utilities, the most important of which, in revenue terms, is provision of water supplies, generated about $4.3 billion, or about 1 per cent of total revenue.

Land transactions generated some $128 billion, or about 22 per cent of total government revenue, in 2016-17. All revenue from land transactions is credited to the Capital Works Reserve Fund to finance the Public Works Programme.

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