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Following is the speech by the Financial Secretary, Mr Henry Tang, at the Hong Kong International Jewellers' Gala Evening today (September 20):
Mr Charles Chan, Mr Edward Cheung, Mr Sam Gin, distinguished guests, ladies and gentlemen,
Good evening. I am delighted to be able to attend the International Jewellers' Gala Evening once again - after attending the first Gala Evening back in 2002. Today, I come here in my capacity as the Financial Secretary as well as chairman of the Commission on Poverty.
I am pleased to note that our jewellery industry has gone from strength to strength over the past years. Hong Kong is now the world's largest exporter of imitation jewellery and the fourth largest exporter of fine jewellery. In 2005, we exported a total of $33 billion worth of jewellery products, a 24% increase over the previous year.
This evening's event is, however, not only about showcasing the success of Hong Kong's jewellery sector, but also about showcasing its dedication in helping the disadvantaged groups in the community. People are our most important and indeed the only asset. To help our young people develop, we need to provide them with positive role models, help them cultivate the right attitude to learning, and lay a good foundation not just for their future career development but also for a better life.
I am therefore very pleased to see that the Hong Kong Jewellery & Jade Manufacturers Association is actively supporting the "Adopt-A-School" project launched by the Commission on Poverty. Under this project, adopting companies develop a long-term relationship with the adopted schools. This is a new partnership between the business sector and schools in providing children from different family background better opportunities to develop their full potential. I hope more and more companies and people from the business sector would share with the community your expertise, resource and most important of all, your dreams of making Hong Kong a better place for all, and take part in this meaningful project for our next generation.
While we are on long term plans to make Hong Kong a better place, you will of course know that the Government has embarked on a public consultation on tax reform and broadening of Hong Kong's tax base. Our objective is to ensure that our public finance system is sustainable and can cater for the long-term need of this community that we all cherish and love.
I know there are concerns in the jewellery sector that introduction of a broad base goods and services tax (GST) may impact on your business environment. I would like to take the opportunity to assure you that we fully recognise the importance of international trade to our economy and we are proposing a number of measures to alleviate the possible impact of GST on your businesses.
Under the present proposed GST framework, no GST would be chargeable on export and trans-shipment of goods, including jewellery and registered exporters could reclaim the GST they have paid on their purchases. So GST would not affect the competitiveness of your industry. On the import side, we are proposing a number of facilitative arrangements to relieve your potential cashflow concerns. These include deferral and waiver of payment of GST for your imports, as well as special storage arrangements for your imported goods for which GST would be suspended. The whole purpose is to avoid increasing your cashflow burden and to maintain Hong Kong's competitiveness.
The above are only some of our initial proposals to facilitate further discussions. We are open-minded to your suggestions and welcome opportunities to discuss with the trade further so that we could arrive at the best arrangements for all. The jewellery sector has demonstrated good corporate citizenship in your active participation in the "Adopt-a-School" project. We hope you will adopt an equally positive attitude in the discussions on broadening of the tax base which is so important to the long term prosperity of Hong Kong and to the next generation.
On that happy note, I would like to wish you continued success in your business and good health and prosperity.
Thank you very much.
Ends/Wednesday, September 20, 2006
Issued at HKT 20:20
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