HONG KONG: Hong Kong’s government plans to reduce taxes, increase welfare spending and support tourism-related businesses after economic growth slowed last year.
Measures announced in its budget include reducing personal tax by as much as HK$20,000 ($2,580) this financial year, providing extra allowances for the poor and elderly, and waiving some fees for the tourism industry, the government said.
Rival financial center Singapore this week also announced plans to strengthen social security support for older workers. In Hong Kong, the government faces the additional challenge of trying to restore confidence after pro-democracy protests froze parts of the city late last year and push through the legislation to reform the city’s leadership election in 2017 that sparked the student-led demonstrations.
“The government is still relying too much on the one-off, ad hoc relief measures,” said Raymond Yeung, an economist at Australia & New Zealand Banking Group Ltd. in Hong Kong.
The government said it will waive license fees for some travel agents, hotels and restaurants for six months, as well as allocate additional spending to promote Hong Kong to international investors and tourists.
“We need to rebuild international investors’ and tourists’ confidence in Hong Kong and uplift our international image,” the government said.
