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Hong Kong's New Chief Executive Proposes a Competitive Tax Regime

Written by: Editor

Hong-Kongs-New-Chief-Executive-Proposes-a-Competitive-Tax-Regime.jpgHong Kong’s new Chief Executive firmly believes that the city must maintain its competitive advantage through a low and simple tax regime. Carrie Lam addressed the issue of a new tax reform during one of her first speeches after being elected. She said that additional tax breaks for R&D expenditure and other beneficial changes are planned for the tax system. The experts at our law firm in Hong Kong can help you with tax law issues should these changes influence your business in the city.

Hong Kong to maintain its competitiveness

 
Carrie Lam, the newly elected Chief Executive of Hong Kong promised that she will continue to pursue the low and simple tax policy while still making some new adjustments that will only increase the city’s attractiveness from a taxation point of view.
 
She stated that Hong Kong should introduce certain tax breaks for R&D expenditure. This would put the city at an advantage, compared to other jurisdictions in the region like Singapore. The new Chief Executive also said that she will encourage development and investments in areas like environmental protection, culture, arts or design.
 
Discussions about an important corporate tax reduction also took place with respect to small companies and start-ups in Hong Kong. If Lam’s plans will succeed, the tax rate for small and medium-sized companies in the city will drop from 16.5 percent to ten percent for the first 2 million HKD of the company’s profits. While this measure is not a certainty yet, our lawyers in Hong Kong can give you complete tax counseling and advice is you run a business here and need to know more about these planned changes.

Hong Kong’s low and simple tax regime

 
Hong Kong’s low and simple tax regime is an advantage for many foreign investors. Moreover, its close proximity to Mainland China makes it a good location for Chinese companies that want to expand onward and for foreign investors who base their branches in Hong Kong and are interested in manufacturing in China.
 
The said positive changes in taxation would further increase the set of advantages for foreign investors in Hong Kong.
 
If you would like to know more about the tax laws for companies in the city please contact our law firm in Hong Kong
 
 

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