Hong Kong Budget targets COVID-19 relief with tax breaks, handouts - CNA

Bars, gyms, beauty parlours and 12 other types of venues are closed, while restaurants cannot operate beyond 6.00 pm. Apart from grocery stores, most shops are deserted as residents are back working from home. The border is virtually shut with the finance sector complaining this has caused an exodus of talent and made operating a regional hub out of Hong Kong difficult.

The restrictions will last until at least Apr 20.

TAX CUTS

The Budget measures announced on Wednesday include a 100 per cent reduction in salaries tax, capped at HK$10,000, handouts of HK$10,000 consumption vouchers, financial aid for the unemployed, and subsidies for directly impacted businesses.

Residents will also be given tax deductions related to their rent payments, as well as subsidies for transport and utilities.

A 100 per cent reduction in profits tax capped at HK$10,000 is expected to benefit 151,000 firms, Chan said. In addition, the government will help small firms with loan guarantees, export financing, and debt repayment holidays.

New legislation will be introduced to prevent landlords from terminating rental contracts of struggling small firms for up to six months.

Funds worth HK$1.26 billion will be given to firms in the tourism industry, reeling from two years of inactivity with no near-term prospects of recovery.

The "anti-epidemic" measures include HK$22 billion to boost COVID-19 testing capacity, HK$6 billion to procure more vaccines, and HK$12 billion for the construction of more health facilities, among others.

Hong Kong's economy is expected to grow 2 per cent to 3.5 per cent this year after expanding 6.4 per cent in 2021, Chan said, adding the forecast takes into account a recovery in the second part of the year once the epidemic is brought under control.

"The successful control of the epidemic is the key to safeguarding our economy and people's livelihood," Chan said.

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2022-02-23 06:28:14Z
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