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LCQ13: Rates concession
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    Following is a question by the Hon Frederick Fung and a written reply by the Secretary for Financial Services and the Treasury, Professor K C Chan, in the Legislative Council today (November 21):

Question:

     Will the Government inform this Council:

(a)  of the percentage of properties for which government rent is also payable in the total number of rateable private properties at present; and

(b)  given that in his 2007-2008 Policy Address, the Chief Executive announced that the rates for the last quarter of this financial year would be waived subject to a ceiling of $5,000 for each rateable tenement, whether the Government has examined if this is fair to the property owners who have to pay both government rent and rates; of the percentage of private properties in respect of which the amount of waived rates for the last quarter is less than $5,000 in the total number of rateable private properties; whether it will consider waiving both the rates and government rent at the same time, subject to a ceiling of $5,000 for the total amount of money waived per tenement, so as to increase the amount of benefits for the property owners concerned; if such a consideration will not be made, of the reasons for that; and the estimated amount of government revenue foregone as a result of the above measure of waiving both the rates and government rent?


Reply:

Madam President,

(a)  According to the information of the Rating and Valuation Department, there are currently some 1.48 million private properties liable for both rates and government rent collected under the Government Rent (Assessment and Collection) Ordinance (Cap. 515).  They account for 67% of some 2.2 million private properties liable for rates in Hong Kong.

(b)  We estimate that among the 2.2 million rateable private properties, about 96% would be completely exempt from rates in the last quarter without exhausting the $5,000 concession limit.

     Government rent is the rent paid by all property owners to the Government under land leases in return for the right to hold and occupy the land.  Its nature is different from that of rates, which are a kind of tax.  Therefore, it is not appropriate to compare the two.  The Administration currently has no intention to extend the rates concession to government rent.  If all private properties were to be exempt from both rates and government rent for the last quarter of 2007-08 subject to a ceiling of $5,000, the Government's revenue loss would be about $3.25 billion.



Ends/Wednesday, November 21, 2007
Issued at HKT 11:46

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