HK passes Tax Reduction Bill

The Government of Hong Kong has expressed its gladness about passing through the Legislative Council of the Inland Revenue (Amendment) (No. 2) Bill 2013, which allows the Inland Revenue Department (IRD) to implement the tax reduction measures contained in the 2013-2014 Budget.

The revenue measures in the Bill include as follows:
– an increase in both the basic and additional child allowances under salaries tax and tax under personal assessment,
– an enhancement in the deduction ceiling for expenses of self-education under salaries tax,
– a one-off reduction of salaries tax, tax under personal assessment and profits tax for the year of assessment 2012-2013 by 75%, subject to a ceiling of HK$ 10 000 per case.

The Secretary for Financial Services and the Treasury, Professor K C Chan said: “We are pleased to see the passage of the Bill, which allows the IRD to effect the one-off tax reduction in this year’s tax bills, and to apply the new child allowances and deduction ceiling for expenses of self-education, if applicable, in calculating the provisional tax for the year of assessment 2013-14.”

About 1.53 million taxpayers will benefit from the one-off reduction of salaries tax and tax under personal assessment. About 310,000 taxpayers will benefit from increasing child allowances as well as enhancing the deduction ceiling for expenses of self-education.

Filed under: HK Law changes, Taxation

Chain volume measures of GDP by economic activity for 1st quarter of 2013

On June 20, 2013, the Census & Statistics Department released the preliminary figures of chain volume measures of Gross Domestic Product (GDP) by economic activity for the 1st quarter of 2013.

According to the preliminary figures, overall GDP increased by 2.8% in real terms in the 1st quarter of 2013 over a year earlier, virtually the same as that in the 4th quarter of 2012.

Analysed by constituent services sector and on a year-on-year comparison, net output in respect of all the services activities taken together increased by 2.9% in real terms in the 1st quarter of 2013 over a year earlier, compared with the 2.7% growth in the 4th quarter of 2012.

Net output in the import and export, wholesale and retail trades sector grew by 5.8% in real terms in the 1st quarter of 2013 over a year earlier, compared with the increase of 3.8% in the 4th quarter of 2012.

Net output in the financing and insurance sector increased by 4.5% in real terms, following the 1.1% rise in the 4th quarter of 2012. The faster growth in net output of this sector was underpinned by the improved financial activities amid some stabilisation in global financial conditions.

Figures of chain volume measures of GDP by economic activity for the first quarter of 2013 are only preliminary at this stage. When more data become available, the preliminary figures will be revised accordingly.

Filed under: Financial statistics, HK as a Financial Centre

HK total exports up 8.6%

On June 20, 2013, the Census & Statistics Department said that the volume of Hong Kong’s total goods exports and imports in April 2013 increased 8.6% and 7.9% compared to April 2012.
 
The volume of Hong Kong’s goods re-exports increased 8.9%, while that of domestic exports decreased 7.1% year-on-year.
 
Comparing the 1st 4 months of 2013 with the same period in 2012, the volume of Hong Kong’s goods re-exports increased 5.4%, and that of domestic exports decreased 5.2%.
 
Taken together, the volume of total goods exports increased 5.2% and the volume of goods imports increased 5.7% year-on-year in the period.
 
When comparing April 2013 with April 2012, domestic exports prices increased 2.3% and those of goods re-exports increased 0.9%.
 
Taken together, the prices of total goods exports and imports increased 0.9% and 1% respectively year-on-year for April.
 
For the 1st 4 months of 2013 over the same period in 2012, domestic exports’ prices increased 3.7% while those of goods re-exports increased 0.6%.
 
Taken together, the prices of total goods exports increased 0.7% and the prices of goods imports increased 1.1%.

Filed under: Business and Economy, Financial statistics

HKMA investigates HSBC and other banks for inappropriate market conduct

On June 18, Hong Kong’s de facto central bank said that its investigation into possible benchmark rate manipulation has been extended to include HSBC and a number of other banks.

In December 2012, the Hong Kong Monetary Authority (HKMA) announced that is investigating UBS about possible misconduct relating to its submissions for the Hong Kong Interbank Offered Rate (Hibor). Apart from UBS, it has followed up with a number of banks including HSBC to ascertain whether there have been any inappropriate market conducts in their benchmark rate submissions.

The investigation is ongoing.

Filed under: Banking Services, HK as a Financial Centre