Bold measures to support businesses and individuals are a priority in the 2023-24 Budget that includes the disbursement of a $5,000 electronic consumption voucher, Financial Secretary Paul Chan announced while unveiling his Budget today.

When it comes to assisting enterprises, Mr Chan said he proposes a basket of measures aimed at easing the operating pressure of businesses.

Such plans include reducing profits tax for the year of assessment 2022-23 by 100%, subject to a ceiling of $6,000. The measure will benefit 134,000 businesses and reduce government revenue by $720 million.

He also suggests providing rates concession for non‑domestic properties for the first two quarters of 2023‑24, subject to a ceiling of $1,000 per quarter for each rateable property. This measure is estimated to involve 430,000 non‑domestic properties and reduce government revenue by $740 million.

Additionally, Mr Chan is putting forward a plan, starting July 2023, that would grant a 50% rental or fee concession to eligible tenants of government premises and eligible short‑term tenancies and waivers under the Lands Department for six months until the end of 2023.

The finance chief pointed out that to meet the financing needs of small and medium enterprises (SMEs) during economic downturns, the Government has been enhancing the SME Financing Guarantee Scheme (SFGS) continuously over the years. 

He said: “As at end‑2022, loans amounting to more than $230 billion have been approved under the SFGS, benefiting over 53,000 enterprises. As the Hong Kong economy is picking up steadily this year, it is expected that commercial financing will gradually return to be adjusted by the market. 

“That said, it takes time for SMEs to consolidate their strengths on the way to recovery. I have, therefore, decided to extend the application period of all guarantee products under the SFGS from end‑June 2023 to end‑March 2024, thus giving SMEs more room to adjust and secure a firm footing.”

To support cross‑boundary passenger transport and the tourism industry, the Government will launch new schemes to offer fully guaranteed loans for eligible passenger transport operators and licensed travel agents. 

Mr Chan estimates that the above schemes will involve a total loan guarantee amount of about $2.7 billion. 

The Government will also extend the Travel Agents Incentive Scheme, which is due to expire by end‑March 2023, for three months, with the goal of facilitating the speedy recovery of the industry. 

In addition, the Government will inject $30 million into the Information Technology Development Matching Fund Scheme for Travel Agents. The objective of this scheme is to encourage the industry to undergo upgrades and transformation by making use of technology.

Supporting the general public

On the topic of supporting the society’s needs, Mr Chan says he will introduce several one‑off relief measures to alleviate the economic pressure on the public.

One such measure aims to reduce salaries tax and tax under personal assessment for the year of assessment 2022/23 by 100%, subject to a ceiling of $6,000. This measure will benefit 1.9 million taxpayers and reduce government revenue by $8.5 billion.

A second measure, he suggests, will provide rates concession for domestic properties for the first two quarters of 2023‑24, subject to a ceiling of $1,000 per quarter for each rateable property. This measure is estimated to involve 3.03 million domestic properties and reduce government revenue by $5.2 billion.

Another proposal includes providing an allowance to eligible social security recipients, equal to one half of a month of the standard rate Comprehensive Social Security Assistance payments, Old Age Allowance, Old Age Living Allowance or Disability Allowance. This measure will involve an additional expenditure or about $2,721 million. Similar arrangements will apply to recipients of the Working Family Allowance, involving an additional expenditure of about $116 million.

He also recommends extending the temporary special measures under the Public Transport Fare Subsidy Scheme for a period of six months to provide commuters with a subsidy amounting to one‑third of their actual monthly public transport expenses in excess of $200, subject to a maximum of $500 per month. It will require an additional expenditure of about $1.08 billion and benefit 3.5 million commuters per month.

A different plan calls for paying the examination fees for school candidates sitting for the 2024 Hong Kong Diploma of Secondary Education Examination.

Being able to grant each eligible residential electricity account a subsidy of $1,000 is also included in the one-off relief measures.

Apart from noting that the current arrangement of distributing electricity charges relief of $50 a month to each eligible residential electricity account will be extended to the end of 2025, Mr Chan shared his plan to increase the basic child allowance.

“I propose to increase the basic child allowance and the additional child allowance for each child born during the year of assessment from the current $120,000 to $130,000 starting from the year of assessment 2023-24. This measure is estimated to benefit 324,000 taxpayers and reduce tax revenue by $610 million a year.”

Issuing consumption vouchers

Regarding the issuance consumption vouchers, Mr Chan explained that the Government implemented two rounds of the Consumption Voucher Scheme over the past two years.

Because the initiatives were well received by the community and due to other reasons, he revealed that another round of the consumption vouchers will be disbursed.

“Having regard to the current economic situation, people’s livelihood and the Government’s financial position, I will issue electronic consumption vouchers again this year with a total value of $5,000 to each eligible Hong Kong permanent resident and new arrival aged 18 or above in two instalments.”