The Limited Times

Now you can see non-English news...

Budget|Scholars advocate increasing stamp duty on stocks, the industry moans that "bits" of profits have become unprofitable

2023-02-21T04:31:21.497Z


The new "Budget" will be released tomorrow (22nd). The market is concerned about whether the stamp duty on stocks will be adjusted. Some scholars believe that increasing the stamp duty is a "painless tax" for Hong Kong people. But there are also people in the industry who "groan"


The new "Budget" will be released tomorrow (22nd). The market is concerned about whether the stamp duty on stocks will be adjusted. Some scholars believe that increasing the stamp duty is a "painless tax" for Hong Kong people.


However, some people in the industry "groaned" that transaction costs had risen, and the original "little profits" had become "unprofitable". For the purpose of making a big cake, the stamp duty should be lowered.


In order to increase treasury revenue, the Hong Kong government proposed in the 2021/22 Budget two years ago to increase the stamp duty rate on stocks from 0.1% to 0.13%.

However, as the trading volume of Hong Kong stocks decreases, the government's wishful thinking is difficult to start. As of the end of 2022, the stock trading volume in the first nine months of the fiscal year has dropped by 20% compared with the same period of the previous year, which directly affects stamp duty.

However, the Hang Seng Index fell by 15% last year, the worst in the past 11 years. Therefore, it is still difficult to say whether the decline in Hong Kong stock market turnover is due to the worsening market conditions or the increase in stamp duty on stocks.

Zhuang Tailiang believes that the government's increase in stamp duty on stocks is a "painless tax" for Hong Kong people.

(profile picture)

Zhuang Tailiang: Increasing stamp duty is a "painless tax" for Hong Kong people

The new fiscal year's "Budget" will be released tomorrow (22nd). Some scholars have suggested increasing the stamp duty on stocks. Zhuang Tailiang, executive director of the Lau Chor-teh Institute of Global Economics and Finance at the Chinese University of China, said in an interview that the government's increase in stamp duty on stocks did not affect the stock market. Trading volume has plummeted, and most transactions in Hong Kong stocks are conducted by overseas investors, which only affects short-term speculators or overseas fund companies. It is a "painless tax" for Hong Kong people.

He believes that investors should pay more attention to transaction income than taxes, and it is advisable to increase the stamp duty to 0.15%, which can contribute more than 7 billion yuan to the treasury.

At the same time, I call on the rulers not to increase taxes according to their own preferences. For example, "If you don't like people who gamble, you can increase the gaming tax." Because of the existence of peripheral gambling games, tax increases may not necessarily equal tax increases. Reiterate that you must not "bully" a small group of people with your own will people.

Tan Langwei pointed out that the increase in stamp duty on stocks will hit local professional investors.

(profile picture)

Tam Lang-wei: Hong Kong stock market turnover decreased due to the government's small losses

Tan Langwei, co-director of Fulbright Securities, held the opposite suggestion. He believed that the increase in stock stamp duty would hit local professional investors. Whether they were securities brokers or ordinary speculators, they all made money by buying and selling stocks, futures indexes, and "climbing checkered boxes" and contributed to the market's daily income. The daily trading volume is stable, but the increase in stock stamp duty has increased the transaction cost of Hong Kong stocks, and the original "little profit" has become "unprofitable".

Tan Langwei also pointed out that many brokerages of securities firms changed careers during the bear market last year. The market drop was undoubtedly the biggest incentive, but the rise in transaction costs in Hong Kong stocks was also one of the culprits.

He suggested that the government should lower the stamp duty on stocks in the new year's Budget, otherwise Hong Kong's status as an international financial center will be greatly affected. He even bluntly said that increasing the stamp duty in order to increase treasury revenue will lead to a decrease in the turnover of Hong Kong stocks, which is the opposite. The practice of losing the big because of the small.

Lin Zijie said that the transaction costs of Hong Kong stocks have risen, and strategic choices have decreased.

(profile picture)

Lam Tze-kit: Increased transaction costs and fewer strategic choices

Lin Zijie, managing director of Mashan Capital, said that the industry supports the reduction of stamp duty on stocks.

He said that the addition of stamp duty on stocks has increased transaction costs, affecting stock market liquidity and further widening the bid-ask spread, reducing the choice of some trading strategies for institutional investors. Instead, they went to the United States and other exchanges, and the matter itself is putting the cart before the horse.”

Lin Zijie took Hong Kong stock options as an example. Due to the decline in stock liquidity, the related implied volatility has dropped. Some strategies in Hong Kong are "unnecessary" compared with the United States.

He added that the policies of various regions are all aimed at "making the pie bigger". "The trend is to reduce transaction costs and hope to attract volume. The government (tax increase) is to increase revenue. If there is more volume, tax revenue may not be reduced."

Budget|Leung Chi-kin: No one wants the government to consider the "removal of spicy" budget|Scholars denounce the redistribution of consumer coupons such as drug use to promote tightening and advocate sending up to 3,000 to the grassroots. Budget 2023|Deloitte expects the government next year Re-record surplus and call for 5,000 yuan consumption coupons

Source: hk1

All news articles on 2023-02-21

You may like

News/Politics 2024-02-19T06:31:06.329Z
News/Politics 2024-02-16T11:21:04.745Z
Life/Entertain 2024-02-11T04:26:21.024Z

Trends 24h

Latest

© Communities 2019 - Privacy

The information on this site is from external sources that are not under our control.
The inclusion of any links does not necessarily imply a recommendation or endorse the views expressed within them.