Hong Kong Budget 2010 Highlights
Hong Kong Budget 2010 Highlights
The Hong Kong 2010-11 Budget was released on February 24. It contains three main objectives of "Consolidating Recovery, Economic Development and Caring Society". Here are some of the highlights:
Economic data
Review 2009
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GDP fell by 2.7% in real terms
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Goods exports fell by 12.6% in real terms
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Unemployment rate was at 5.2%
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Inflation rate (Composite CPI) of 0.5%
Forecast 2010
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Real GDP to grow by 4-5%
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Inflation rate at 2.3%
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GDP per capita at current market prices to grow from HK$233,200 in 2009 to HK$240,500 - HK$242,800 in 2010
Tax and other related measures
· With effect from April 10, stamp duty on transactions of properties over HK$20mn will increase from 3.75% to 4.25%
· 75% salaries tax reduction for 2009-10, subject to a ceiling of $6,000
· Waiving rates for 2010-11, subject to a ceiling of $1,500 per quarter for each rateable property
· Waiving the business registration fees for one year
Promotion of the development of HK’s four traditional pillar industries and six new industries
- Education - a further site at the former Queen Hill's Camp in the NT of more than 100,000 sq ft will be reserved for the establishment of a self-financing tertiary institution with boarding facilities. Expression of interest will be sought by the end of this year
- Financial services
- Further development of offshore RMB business in HK
- Stamp duty waiver for trading of exchange traded funds (ETFs) that track indices with not more than 40% of HK stocks
- Extension of 50% tax concession for interests and profits from qualifying debt instruments of less than three years issued in HK
- Clarification of "central management and control" to address industry's concern about residency requirement for directors managing offshore funds in order to qualify for profits exemption to help attract more fund managers to manage overseas funds in HK
- Full deposit guarantee under the Deposit Protection scheme will remain in force till end of 2010
- Testing & certification - allocate HK $20 million and $21M respectively in the next two years to the Hong Kong Council for Testing and Certification and the Hong Kong Accreditation Service
- Environmental - to set up a $300M Pilot Green Transport Fund for application by the industry, initially by the public transport operators to encourage more innovative green technologies in the transportation sector
- Innovation & Technology
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a funding of $200 million to set up a "R&D Cash Rebate Scheme" to be launched in April this year
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the development of Science Park Phase 3 at an estimated expenditure of $4.9 billion. Construction work is expected to start next year for completion in phases between 2013 and 2016
- Arts, Culture, Sports and other Creative Industries - additional funding of $486M for the development of the West Kowloon Cultural District over the next five financial years; inject $3B into the Arts and Sport Development Fund
- Revitalising old industrial buildings - the Lands Department will set up a dedicated team in April this year to centrally process the applications for redevelopment or conversion of industrial buildings by owners.
Intellectual Property Rights
1. Extend profits tax deductions to cover capital expenditure by enterprises to purchase registered trademarks, copyrights and registered designs
2. Raise the grant ceiling under The Patent Application Grant for first patent application funding from $100,000 to $150,000. The expenditure ceiling for patent applications in R&D projects under the Innovation and Technology Fund will also be raised to $150,000
Improving the financial regulatory system
1. Proposals to establish and "Investor Education Council" and a "Financial Dispute Resolution Centre"
2. Proposal to amend current legislation to require timely disclosure of certain price-sensitive information by listed companies
3. Consultation on modernisation of the Companies Ordinance to enhance corporate governance and facilitate business
4. Consultation on establishment of an independent Insurance Authority and a Policyholders' Protection Fund
5. Consultation on introduction of corporate rescue procedures to reduce corporate bankruptcy and preserve employment
Taiwan
1. The Hong Kong-Taiwan Economic and Cultural Co-operation and Promotion Council will be set up to discuss matters of mutual interest and enhance co-operation with Taiwan
2. The Hong Kong-Taiwan Business Co-operation Committee will be set up to foster co-operation between HK and Taiwan in trade and investment
Investment in infrastructure
Estimated capital works expenditure in 2010-11 will be $49.6B including Kai Tak Cruise Terminal and HK-Zhuhai-Macao Bridge
Full budget speech can be found at here.
Source: Invest Hong Kong
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