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The spicy trick is not enough to suppress the property market and make good use of taxation to serve the society

2022-01-13T08:22:59.740Z


The Inland Revenue Department recently released data on the three major residential stamp duties in Hong Kong last year (commonly known as "spicy tax"). There will be a total of 5,117 cases of the three major stamp duties in 2021, and the amount involved is as high as HK$12.947 billion, compared with 2020.


The Inland Revenue Department recently released data on the three major residential stamp duties in Hong Kong last year (commonly known as "spicy tax").

In 2021, there will be a total of 5,117 cases of the three major stamp duties, and the amount involved is as high as HK$12.947 billion, which is a 40% increase in the number and amount of cases compared to 2020.

In terms of individual stamp duty, the new ad valorem stamp duty (DSD & AVD) involving residential properties recorded an even higher amount of 9.36 billion yuan, accounting for 72.3% of the total of the three major stamp duties, an increase of nearly 50% year-on-year.


Residential stamp duty income has risen sharply, reflecting the frequent transactions, it is still unable to effectively suppress the speculation in the property market.

Private housing prices hit a record high last year, and the government should insist on using public housing to meet public demand, rather than continue to advocate "upstairs".

On the other hand, this also shows that the government can collect considerable revenue from the hot property market.

Some accounting firms predict that the actual fiscal deficit of the government last year was not as serious as it had originally estimated.

Since the government still has a lot of revenue, it should make good use of tax revenue for secondary distribution, rather than just being a "miser."

High property prices public housing is the solution

Although the stamp duty last year was still lower than the level before 2019, after the social movement in 2019 and the two-year COVID-19 epidemic, the stamp duty in 2021 can still record a considerable rebound, reflecting the booming real estate market.

The frequent property market transactions are the factors that support the long-term high property prices.

Property prices hit a new high in September last year, and the Central Plains City Index (CCI) hit a record high of 185.62. Even if it dropped slightly to 182.5 in December, it still rose 4.8% for the year.

The increase is not only higher than the level of inflation and average salary increase, but also far outperforms the local stock market (the Hang Seng Index fell by about 14% year-on-year during the same period).

This undoubtedly reflects that the "spicy tax" alone cannot control the speculation in the property market, and property prices still outperform prices despite multiple unfavorable factors.

In order to better solve the problem of "difficulty in getting upstairs" for Hong Kong people, the government still has to jump out of the idea of ​​helping people "buy a home", and instead use public housing such as HOS and public housing to meet the basic needs of the people, and use it with The commercial housing market for investment is completely separate.

This is the long-term plan.

Make good use of stamp duty, don't be a miser

On the other hand, the 40% increase in stamp duty also shows that the government's financial capacity is better than expected.

Accountant Ernst & Young issued a report on Wednesday (12th) saying that based on its projections of government revenue and expenditure, including new stamp duty and land sales revenue, the government's fiscal deficit in the 2021/2022 fiscal year is about 18 billion. That's nearly 80 percent less than the $101.6 billion estimated in last February's Budget.

Ernst & Young estimates the government budget deficit for 2021-22 to be only about $18 billion.

(EY press release)

The actual answer will be revealed soon in the new Budget.

In fact, the government used to be too conservative in its budget preparation, and it often ran into surpluses, and only accumulated a fiscal reserve of over trillion.

Even though the epidemic has slashed revenue in the past two years, the government's tax revenue is still considerable.

Instead of accumulating more surpluses each year to be a "miser" in fiscal reserves, the government should make good use of its income. First, it is to help the grassroots and citizens in need in response to the current epidemic, and second, it is to increase support in medical care, social welfare, etc. in the long run. , to improve public services.

The Financial Secretary, Paul Chan, also conducted a public consultation on the new Budget. He should change the "financial philosophy" that has always been too conservative, so that tax money can be used properly.

It is time for the Government Housing Authority to consider restarting the repurchase of HOS flats. Although it is desirable, it is not enough for the public to live comfortably and build more houses. They cannot give up their dominance. Public housing supply figures are inappropriately exaggerated. Subsidized housing must be strictly observed. "Just live, don't fry" principle

Source: hk1

All news articles on 2022-01-13

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