Two revenue bills will be gazetted April 20, and tabled at the Legislative Council on May 2, seeking to put into effect tax proposals announced in the 2007-08 Budget.

The Financial Services & the Treasury Bureau said the Revenue Bill 2007 comprises two Budget proposals which came into effect February 28, under the Public Revenue Protection (Revenue) Order 2007.

The proposals are:

* to reduce the duty on wine from the existing rate of 80% to 40%, and that on other beverages with an alcoholic strength of no more than 30% from 40% to 20%; and,

* to reduce the stamp duty rate on transactions of properties valued between $1 million and $2 million from 0.75% to a fixed amount of $100.

The bureau said as the order gives provisional legal effect to these proposals for only four months, it is necessary for the Government to table a bill containing the same proposals at the Legislative Council for enactment.

Further alleviation measures

Other proposals relating to salaries tax and tax under personal assessment will be effected by amending the Inland Revenue Ordinance through the Revenue (No.2) Bill 2007. The bill, when enacted, will come into effect on the day of its publication in the Gazette.

The first proposal under the bill is to revert the marginal tax bands and tax rates of salaries tax to their 2002-03 levels. Each marginal tax band will be widened from $30,000 to $35,000 and the highest two marginal tax rates will be reduced from 13% and 19% to 12% and 17%. The basic allowance and standard rate remain unchanged.

The second proposal is to increase the salaries tax child allowance from $40,000 to $50,000 for each child and introduce an additional child allowance of $50,000 in the year of assessment in which the child was born.

The third proposal is to increase the maximum amount of salaries tax deduction for self-education expenses from $40,000 to $60,000.