Financial Secretary John Tsang has called for a reduction in the first registration tax of commercial vehicles meeting Euro V emission standards to further reduce air pollution.

A 30%, 50% or 100% reduction will be offered to buyers of commercial vehicles meeting the Euro V emission standards depending on the vehicle type. The Environmental Protection Department will announce the proposal details later.

Mr Tsang said if 15% of commercial vehicles applying for first registration are converted to Euro V standards, the proposal will cost the Government $26 million a year.

He also proposed to provide a 100% profits tax deduction for capital expenditure on environment-friendly machinery in the first year of purchase to encourage the business community to use such equipment.

For environment-friendly installations mainly ancillary to buildings, he proposed the depreciation period be shortened from the usual 25 years to five. The Inland Revenue Department and the Environmental Protection Department will announce the qualified list of environment-friendly facilities.

Mr Tsang said a good environment can protect the public's health and is conducive to attracting global talent, thereby enhancing Hong Kong's overall competitiveness. The Government is ready to explore measures to improve the environment and will provide the resources required for implementing effective measures.