On 28 February 2018, the Financial Secretary of the Hong Kong Special Administrative Region, Mr. Paul Chan Mo-po presented the Budget proposal for the country’s tax year beginning 1 April 2018.
Major proposals with respect to tax and business are;
- A one-off reduction of 75% of profits tax for the year of assessment (YA) 2017/18 is proposed. The reduction is limited to HKD 30,000, which is applied to every business.
- Under the proposal, the first HK$2 million (US$256,000) of eligible R&D expenditure will enjoy a 300% tax deduction and the remainder, a deduction at 200%.
- To widen the scope of qualifying debt instruments eligible for tax exemption by including debt securities listed on the Hong Kong Stock Exchange and extending to debt instruments with an original maturity of not less than seven years to instruments of any duration
- Tax concessions for capital expenditure incurred by enterprises in procuring eligible efficient building installations and renewable energy devices will be eligible for a 100% tax deduction in 1 year instead of 5 years.
