Gazettal of Inland Revenue (Amendment) Bill 2018
************************************************
These measures include the following adjustments to salaries tax and tax under personal assessment, with effect from the year of assessment 2018-19:
(a) increasing the number of tax bands from four to five with marginal rates at 2 per cent, 6 per cent, 10 per cent, 14 per cent and 17 per cent, and widening the tax bands from $45,000 to $50,000 each. These adjustments will benefit 1.34 million taxpayers and reduce tax revenue by $4.09 billion a year;
(b) increasing both the child allowance for each eligible child and the additional child allowance in respect of each child born in the year of assessment from $100,000 to $120,000. This measure will benefit 335 000 taxpayers and reduce tax revenue by $1.31 billion a year;
(c) increasing both the dependent parent/grandparent allowance and the additional dependent parent/grandparent allowance for each eligible parent/grandparent from $46,000 to $50,000 (for those aged 60 or above, or with disabilities) and from $23,000 to $25,000 (for those aged 55 or above but below 60);
(d) raising the deduction ceiling for elderly residential care expenses for each eligible parent/grandparent from $92,000 to $100,000;
The measures in (c) and (d) will benefit 607 000 taxpayers and reduce tax revenue by $580 million a year; and
(e) introducing a new personal disability allowance of $75,000 for eligible taxpayers. This measure will reduce tax revenue by $450 million a year.
The above adjustments, with the number of estimated beneficiaries, will together reduce tax revenue by $6.43 billion each year.
The 2018-19 Budget also proposes a one-off reduction of salaries tax, tax under personal assessment and profits tax for the year of assessment 2017-18 by 75 per cent, subject to a ceiling of $30,000 per case. The reduction will be reflected in taxpayers' final tax payable for the year of assessment 2017-18. The proposed one-off reduction will benefit 1.88 million taxpayers of salaries tax and tax under personal assessment, and 142 000 tax-paying corporations and unincorporated businesses. The revenue forgone will amount to $25.5 billion in total.
The Bill will be introduced into the Legislative Council on March 21.
Ends/Wednesday, March 7, 2018
Issued at HKT 12:00
Issued at HKT 12:00
NNNN