Financial Secretary John Tsang wants to hike tobacco duty by 50% with immediate effect, which will see prices rise from 80 cents to $1.20 per cigarette.

In his 2009-10 Budget today, Mr Tsang said the move will bolster the Government's efforts to deter smoking and enhance public health.

He said the Government will boost healthcare expenditure to 17% of recurrent expenditure by 2012. When the supplementary financing arrangements are finalised after consultation for implementation, it will draw $50 billion from the fiscal reserves to implement the reform.

The Government will make use of increased healthcare resources to strengthen services and take forward service reform in the coming years.

Mr Tsang will increase the recurrent subvention for the Hospital Authority over the next three financial years by $870 million a year. The annual subvention in 2011-12 will be approximately $2.6 billion higher than the present level.

He has also earmarked $840 million for the next three financial years to implement complementary measures to strengthen primary care services and support for chronic patients, promote public-private partnership, and develop a Hong Kong-wide electronic health record system.