editorial
Written by: Hong Kong 01
2020-03-02 06:00
Last updated: 2020-03-02 06:00After many calls, the Financial Secretary, Chen Maobo, finally read out a new Budget last week. Among them, the most notable is the distribution of 10,000 yuan to Hong Kong permanent residents who have reached the age of 18. For this reason, the public ’s satisfaction with the budget has reached 46%, which is the highest since February 2010. Chen Maobo ’s popularity has also surged 16.8 points to 43.5 points, reflecting that many citizens are “receiving goods for relief measures” "He smiled at the rare" generosity "of the government. We agree that when the economic situation is changing rapidly, it is necessary to "send money". We understand the mood and reasons of the "receiving goods", but we cannot laugh.
Why ca n’t you laugh? Because the government's "generosity" hides many mistakes in financial management concepts, and these mistakes reflect the authorities' neglect, incompetence, and lagging thinking. As a result, Hong Kong has been unable to step out of its governance dilemma. The most obvious example is the government's view of the deficit-Chen Maobo is concerned about whether the 120 billion yuan bailout measure will constitute a long-term financial burden, emphasizing that "if the fiscal deficit continues to occur, the reserve will eventually run out." It is reasonable to be afraid of the deficit, but if the government lacks a reasonable understanding of how to "spend money" and does not have confidence in financial management, then it is basically the same as "slaves." We believe that a government with a trillion-dollar "family base" on the one hand should not sit on landslides and actively open source to avoid depletion of reserves; on the other hand, it should invest in the future by creating new industries and promoting economic transformation to create more social benefits. A lot of wealth, the rain and dew for all people. It is a pity that in this budget, there are too few places to show the government's vision.
There are too few places in this budget that show the government's foresight. (Photo / Photo by Zhang Haowei)
Under such circumstances, although the Budget includes desirable measures such as increasing the allocation of resources to the Hospital Authority, strengthening social worker services, and launching youth entrepreneurship schemes, it does not, on the whole, convince people that the Government is creating opportunities for Hong Kong's future. The key to this is that the governors are crippled and lack the necessary awareness to cope with the ever-changing challenges. If the Hong Kong Government refuses to "emancipate the mind", live a life of fright, and fear things, and do not understand that its responsibility lies in using public financial means to promote social well-being, then the deep-rooted structural contradictions will not only be resolved, but will continue to accumulate, and eventually the entire people lose.
The process of sending money is slow
Although the budget score reached a ten-year high, it cannot hide the fact that the government lacks a complete set of planning and cannot escape bureaucratic logic when dealing with public finances. Taking the "send 10,000 mosquitoes" as an example, the implementation process is obviously an embodiment of anti-intellectual bureaucratic procedures: first of all, it is expected that the money will not be available until the summer vacation, and it is difficult to save the fire from a long distance; secondly, the cost of "sending money" is extremely high. The last time there was an asset review of "sending 4,000 mosquitoes" costing more than 300 million yuan in administrative fees. This time, there was almost no review of "sending money for the whole people". Instead, one billion yuan was reserved.
When asked if he could speed up the process of "paying money", Chen Maobo claimed that it would take three months for the bank to update its computer system to interface with the government, and it would take time to collect personal data of about 7 million people, as well as how to protect public privacy. The response of the "rich man" seemed secure, but in fact it was completely confusing. Why, after accumulating experience of "paying money" twice, why is the Hong Kong Government still thinking about "how to send money" like a newbie? The budget talks about "smart cities", "digital infrastructure", and "5G era", but even the data management is messed up. How can people have confidence in the authorities? In fact, the processing method is not complicated-the government originally has the citizen's identity card information and immigration records. On this basis, a national database can be established, which is regularly updated like voter registration to avoid the problem of "how to send" in the future.
It is worth mentioning that Singapore, which was also hit by the pneumonia epidemic, also announced "Payment" in the latest budget, but it was distributed in principle-the amount is not a one-size-fits-all, but depends on the annual salary of the beneficiaries, the poor There are more people sent, but less wealthy people. In the mainland terms, they are "targeted poverty alleviation" and "targeted relief". In contrast, the Hong Kong Government has omitted new immigrants who have lived in Hong Kong for less than seven years and need the most help, but are willing to "send money" to those "ex-Hong Kong people" who have not settled in Hong Kong at all and have already emigrated overseas. The citizens who really need help are not fair. If Hong Kong can learn from Singapore, then those in need will get more help.
The Hong Kong Government has omitted new immigrants who have lived in Hong Kong for less than seven years and need the most help, but they are willing to "send money" to "ex-Hong Kong people" who have not settled in Hong Kong and have already emigrated overseas. (Profile picture / Photo by Ou Jiale)
Deadlock Simple Low Tax Doctrine Difficult to Practice Fairness and Justice
The Budget, like the policy address, should have some implications for Hong Kong's way out. Of course, in the short term, it must help rescue people, in the long run, it should be conducive to Hong Kong's sustainable development, and the fairness and justice of society and people's livelihood. While serving as a member of the Accounting Legislative Council in 2011, Chen Maobo moved to set up a tax policy group, "to study the use of tax measures to complement the government's economic and industrial policies, enhance Hong Kong's competitiveness as an international financial and commercial center, address poverty and reduce society. And economic inequality. "Nine years have passed now, and the Tax Policy Group was established as early as 2017, but the ambitious goals he hoped to achieve through this institution were not visible.
In terms of tax measures, Chen Maobo proposed in the budget that salaries tax and personal income tax relief, non-residential property rates, etc., are minor repairs. Although he mentioned "may consider developing new sources of income or adjusting tax rates", the words "may or" and "consider" prove that his attitude is not positive and it seems that he has no intention of thinking about Hong Kong's long-term "simple low tax system" Review. The financial officials of the Hong Kong Government have all regarded the "simple and low tax system" as an advantage of Hong Kong. The "low tax policy" as stipulated in Article 108 of the Basic Law is often used to pretend that the current local tax rate is far lower than the global average. According to the US, According to the traditional foundation, the average and median salaries tax rates of countries around the world are 29.6% and 30%, and the average and median corporate income tax rates are 24.7% and 25%, which are all higher than Hong Kong's salaries tax rate of 15 % And profits tax rate of 16.5%.
It can be seen from the tax data of many countries around the world that "simple low tax" is not a "hard indicator" that cannot be shaken, but a relative concept. Hong Kong is not a tax haven. It should have a more attractive business environment beyond taxation. There is absolutely room for the Hong Kong Government to raise tax rates or set up new taxes such as asset value added tax. Even if we do this, we do not need to disturb ourselves, fearing that our competitiveness will be lost. Hong Kong's competitiveness is multifaceted and should continue to develop in a diversified direction. As long as it is properly planned, including maintaining and strengthening market openness, the rule of law, and professional advantages, and making good use of development opportunities in the Mainland, Hong Kong's competitiveness can be maintained or even enhanced. . By then, the Hong Kong Government will not only have to worry about running out of reserves, but will have more to invest in improving people's livelihood and practice fairness and justice.
With reference to many economies in the world, Hong Kong actually has a lot of room to broaden its tax revenue sources. Letting citizens discuss together democratically can enhance citizens' sense of public financial responsibility. (Profile picture / Photo by Luo Junhao)
Exploring new economic growth points
In addition to backward tax thinking, the lack of industrial policies is also the reason for Hong Kong's dilemma, but Chen Maobo still lacks courage in this regard. Hong Kong politicians should understand that the distorted industrial structure is the root cause of the lack of superior opportunities for young people, the disparity between the rich and the poor, and social injustice. In fact, the pattern of Hong Kong's industry has hardly changed in the 23 years since its return. Among them, the "four pillars" as a percentage of the gross domestic product (GDP) increased slightly from 56% in 2009 to 57.4% in 2018; and the "Six Advantage Industries" (cultural and creative industries) , Education, private healthcare, testing and certification, environmental protection industry, and innovative technology), only slightly increased from 7.8% in the year to 9%.
It is worth noting that education and medical care in the "six major industries" are Hong Kong's strengths. The government should develop these strengths into industries that can bring a lot of high value-added jobs and economic returns to Hong Kong on the premise of meeting local needs. However, the Financial Secretary does not think so at all. For example, medical care is only considered as a public service, not a promising industry that can increase the income of employees.
"Hong Kong 01" has repeatedly pointed out that Hong Kong must not only look at the real estate industry with an appropriate concept, but also consolidate its traditional advantages in finance and professional services, and it must also find new economic growth points. Although the Budget has a similar formulation, it is a pity that it lacks corresponding measures to support it. In fact, Hong Kong has learned a lot in this regard. For example, the reason why Wang Tao, the founder of drone companies who studied in Hong Kong in the early years, chose to take root in Shenzhen is because Hong Kong lacks an ecosystem that is conducive to innovation and technology development. Recently, the Hong Kong Polytechnic University has successfully developed a rapid test system for respiratory infectious diseases, which can distinguish 40 types of viruses, including the new crown pneumonia virus, within one hour. Government funding, even if the project is put into production in the future, it must rely on the support of the Shenzhen Municipal Government. We have to ask, after the successive opportunities for developing new industries have been lost, when will the Hong Kong Government wake up and meet the next possible opportunity with the right attitude?
The percentage of the "six major industries" (cultural and creative industries, education, private healthcare, testing and certification, environmental protection industry, and innovative technology) proposed by Tsang Yam-kuen in 2009 only slightly increased from 7.8% of the year to 9%. (Photo / Photo by Liang Pengwei)
Even though the government has begun to change its mindset in some areas, it still feels embarrassed as a whole. For example, although Chen Maobo mentioned the concept of "land reserve" in the plan, we have not yet seen specific suggestions on how to establish a reserve. Another example is that the authorities will allocate 22 billion yuan from the "Future Fund" to set up a "Hong Kong Growth Portfolio" portfolio similar to Singapore's sovereign fund Temasek and invest in "Hong Kong-related" companies, projects or funds. It is a new economic project such as medical care and technology. If it can be implemented, the government will undoubtedly take the right step.
"Hong Kong 01" has always called on the Hong Kong Government to actively explore emerging industries with strategic value, including innovation and technology, so as to promote social and economic transformation. We don't want the government to do anything to the east of Singapore. It must comprehensively explore how to manage Hong Kong's reserves. Both fiscal reserves and foreign exchange reserves must be actively used to prepare for Hong Kong's industrial transformation. Everyone must know that as long as a one-percentage-point return on the trillion yuan of fiscal reserves is an increase of 10 billion yuan in fiscal revenue, if properly used, it will be a great help for social reform.
After experiencing the dual blows of anti-revision demonstrations and the new crown pneumonia epidemic in Hong Kong, the social elite should understand that change is urgent. Although old methods such as "paying money" and tax cuts can alleviate the temporary difficulties, they will not help the long-term development of the city. The government must use public financial means to create more opportunities and wealth for the society with more practical measures. Both the "land bank" and the "Hong Kong version of Temasek" are well-intentioned measures that must be carefully planned and implemented carefully. We expect the authorities to plan their work carefully and drive policy innovation with innovative thinking. Only in this way can Hong Kong not continue to linger and start again as soon as possible.
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