Tax talk: Financial Secretary Henry Tang says the Strategic Development Commission agrees that Hong Kong must broaden its tax base.

Financial Secretary Henry Tang says he is disappointed some political parties suggest an early termination of the consultation on tax reform, adding that all Hong Kong people cherish the opportunity to express their views on public policy proposals.

Speaking after a meeting of the Strategic Development Commission's Committee on Economic Development & Economic Co-operation with the Mainland today, Mr Tang said members generally agree it is necessary to broaden Hong Kong's tax base and a goods and services tax is something the Government can consider.

He said in the coming months, the tax reform discussion will focus on:

* whether Hong Kong needs to broaden its tax base:

* what is the best way to broaden it:

* what kind of GST arrangement suits Hong Kong best:

* what is the possible impact on Hong Kong's economy and different sectors if a GST is implemented, and how to alleviate any possible pressure: and,

* how to use the extra revenue generated by a GST to help the needy.

The Government will listen to public views through different channels, including consultation forums.

Opposition expected

Mr Tang said economies that have introduced GST have also faced opposition to the move.

"Over the course of time the population tends to come around and starts to understand some of the more complex and fundamental questions we are posing to the community," he said.

"These difficult questions are not going to go away by themselves. We cannot sweep them under the carpet and we should not sweep it under the carpet. So that's why I am hoping we are able to discuss these problems in a constructive and rational manner."

Secretary for Financial Services & the Treasury Frederick Ma said the majority of the committee members considered it is inappropriate to shorten the consultation period.

On some lawmakers' suggestion of having a motion debate on the issue when the Legislative Council meeting resumes, Mr Ma said more discussions on tax reform is good because the Government will have more opportunities to explain its stance.