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Hong Kong

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Hong Kong 2016-2017 Budget Delivered with a Focus on Supporting Businesses

On 24 February 2016, Hong Kong's Financial Secretary John C Tsang delivered the 2016-2017 Budget. The main features of the budget include:

  • A 75% reduction in final profits tax for 2015-16, with a benefit cap of HKD 20,000;
  • Measures to support SMEs, including:
    • Extending the SME Financing Guarantee Scheme to 28 February 2017;
    • Reducing the annual guarantee fee rate by 10%; and
    • Removing the minimum guarantee fee;
  • A waiver of the business registration fees for 2016-17;
  • A three-year Pilot Technology Voucher Program for SMEs under the Innovation and Technology Fund providing a matching subsidy of up to HKD 200,000 for technological services and solutions to improve productivity and upgrade or transform business processes;
  • Measures to promote R&D activities, including an increase in the R&D Cash Rebate Scheme to 40%;
  • Expansion of the scope of the tax deduction for capital expenditure incurred for the purchase of IP rights to also include layout-design of integrated circuits, plant varieties and rights in performance;
  • Measures to support the tourism industry, including a waiver of license fees for travel agents, hotels and restaurants; and
  • Measures to support individuals, including a 75% reduction in final salaries tax and tax under personal assessment for 2015-16, with a benefit cap of HKD 20,000, as well as increased allowances and a waiver of rates on property in 2016-17 with a cap of HKD 1,000 per quarter.

The Budget measures must be enacted by the Legislative Council before entering into force, and are subject to change.

Click the following link for additional information on the 2016-2017 Budget website.

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