Revenue boost: Revenue generated from the Boundary Facilities Improvement Tax will be used to finance checkpoint upgrades, including the Lok Ma Chau Control Point.

The proposed Boundary Facilities Improvement Tax is estimated to make about $1 billion a year when it is introduced in 2004-05 to soothe the fiscal deficit and finance checkpoint upgrades.

The bill, approved by the Executive Council today, will be gazetted by the Government on June 6 and tabled at the Legislative Council on June 11.

The bill proposes that passengers, other than those departing in a private car, leaving Hong Kong via land or sea departure points will have to pay $18.

Private cars leaving through land departure points will have to pay $100 each.

Exemption will be given to people like boundary-crossing full-time primary and secondary students, children under 12, drivers, crew members, transit passengers, passengers arriving in Hong Kong due to adverse weather or emergency, as well as visiting diplomats and consular officials.

To ease the financial burden of frequent commuters, a concession by way of a monthly tax at $270, equivalent to the tax payable for 15 trips, will be introduced.

But this will not apply to private cars and cruise ships.

The tax will be collected off-site by transport operators together with the fares to ensure smooth passenger and traffic flow.

While transport operators engaged by the Government to collect the tax will have to take up certain statutory responsibilities, they will be provided with a collection fee as determined by the Financial Secretary for additional expenditure incurred for collecting the tax.

Private car owners will be billed in arrears using the information captured by the existing Automatic Vehicle Recognition System of the Customs & Excise Department.

The existing Passenger Embarkation Fee of $18 charged on a ferry vessel owner in respect of each passenger departing Hong Kong at the China Ferry Terminal and Macau Ferry Terminal will be abolished upon introduction of the tax.