[Budget 2020] 100% Reduction of Salaries Tax and Personal Income Tax

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Written by: Lao Minyi

2020-02-26 11:42

The outbreak caused by the new coronavirus pneumonia is still ongoing, and the tourism, catering and retail industries in Hong Kong have been hit hard. The Financial Secretary, Chen Maobo, today (26th) released a new Budget, which is of great concern to all sectors of the community. However, Chen Maobo stated on the blog earlier that the government has limited resources and the budget cannot meet everyone's requirements.

Chen Maobo announced a reduction of 100% profits tax for the year of assessment 2019/20, with a ceiling of 20,000 yuan, benefiting 141,000 taxpayers in Hong Kong; a 100% reduction of salaries tax and personal income tax for the year of assessment 2019/20 The upper limit is also 20,000 yuan, benefiting 1.95 million taxpayers in Hong Kong. In addition, the government will waive the annual rates for residential properties in 2020/21, with an upper limit of 1,500 yuan per quarter per household, which is estimated to benefit 2.93 million residential properties.

▼ 30 billion measures for epidemic prevention and anti-epidemic funds ▼

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Wuhan pneumonia outbreak is expected to be more severe than SARS

Chen Maobo reviewed Hong Kong's economy. The labor market has gradually weakened. The seasonally adjusted unemployment rate has risen from 2.8% in the second quarter of last year to the latest 3.4%, the highest level in more than three years. The unemployment rate rose to 5.2%, the highest in three years. Among them, the unemployment rate in the catering service industry soared to 6.1%, the highest level in eight years. He said that the threatening new coronavirus epidemic has severely affected Hong Kong's economic activity and atmosphere. The short-term impact of the epidemic on Hong Kong's economy may be even greater than that in SARS in 2003, and the labor market will also face tremendous pressure. This year's budget will focus on "supporting enterprises, protecting employment, boosting the economy, and alleviating the plight of the people." Therefore, the introduction of large-scale counter-cyclical measures involving more than 120 billion yuan will help Hong Kong weather the difficulties.

Reduction of 100% profits tax ceiling of 20,000 yuan

Chen Maobo announced a 100% profit tax reduction for the 2019/20 tax year, with a ceiling of 20,000 yuan, benefiting 141,000 taxpayers in Hong Kong. The deduction will reflect the final tax payable in the 2019/20 tax year Government revenue will be reduced by 2 billion yuan. In addition, rates for non-residential properties in 2020/21 will be waived. The first two quarters will be capped at $ 5,000 per quarter per household, and the next two quarters will be capped at $ 1,500 per quarter per household, which is estimated to benefit 420,000 non-residential properties. Government revenue will be reduced by 3.2 billion yuan.

Chen also announced that the 2020/21 business registration fee will be waived, benefiting 1.5 million business operators, and government revenue will be reduced by 3 billion yuan. The company registry will fully waive the company's annual return registration fee (overdue registration) Except for a period of two years, the relevant measures will benefit about 1.4 million companies and the related income will be reduced by 212 million yuan in total.

100% reduction in salaries tax and personal income tax

In addition, the government announced a reduction of 100% salaries tax and personal income tax for the year of assessment 2019/20, with a ceiling of 20,000 yuan, benefiting 1.95 million taxpayers in Hong Kong. The deduction will reflect the final tax payable in the 2019/20 tax year. Government revenue will be reduced by 18.8 billion yuan. At the same time, the annual rates for residential properties in 2020/21 will be waived, with a quarterly rate of 1,500 yuan per household. The upper limit is estimated to benefit 2.93 million residential properties, and government revenue will be reduced by 13.3 billion yuan.

Subsidy for non-residential users for 75% of electricity bills for four months

Chen Maobo announced that subsidizing qualified non-residential power users for an additional four months of 75% monthly electricity bills, with a monthly subsidy cap of 5,000 yuan per government, and government expenditure of about 2.9 billion yuan; 75% reduction for non-residential users for an additional four months The maximum monthly deductions and exemptions for water and sewage charges payable by households are 20,000 yuan and 12,500 yuan, respectively, and government revenue will be reduced by 340 million yuan. Relief measures totaled about 18.3 billion yuan. I hope that the measures will not only support enterprises, but also help to secure the jobs of more than 3 million wage earners, and call on employers and employees to ride through the difficult times.

Other measures to benefit wage earners include an additional allocation of $ 30 million per year, optimizing the employment plan of the Labour Department, and further encouraging employers to hire older persons, young people and people with disabilities. It is expected to be introduced in the second half of this year and will benefit about 4,000 people each year; employees The ERB will optimize the new “Special ‧ Value Added” plan launched in July this year and add about 10,000 places to provide training and allowances for employees affected by the economic downturn. It will also pass amendments to train students The monthly maximum allowance increased from $ 4,000 to $ 5,800, benefiting more than 40,000 students each year, with an additional expenditure of about 2.5 billion yuan; the Construction Industry Council will allocate 200 million yuan from the levy income to About 6,000 eligible SME contractors and registered subcontractors provide subsidies, each capped at 20,000 yuan.

▼ Hong Kong masks, panic buying, conflict, winter under the epidemic ▼

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