(from
left
to
right)
Mr
Janssen
Chan,
Co-Chairperson
of
Taxation
Committee
and
Chairperson
of
SME
Committee
of
CPA
Australia
Greater
China;
Ms
Karina
Wong,
Divisional
President
2025
and
Deputy
Chairperson
of
Taxation
Committee
of
CPA
Australia
Greater
China;
Mr
Anthony
Lau,
Co-Chairperson
of
Taxation
Committee
of
CPA
Australia
Greater
China;
Mr
Adam
Chiu,
Member
of
Taxation
Committee
of
CPA
Australia
Greater
China
Explore
strategies
to
increase
revenue
and
reduce
costs
CPA
Australia
emphasises
the
need
to
explore
innovative
strategies
for
increasing
revenue
and
optimising
public
expenditure.
One
suggestion
is
expanding
the
application
of
the
user-pays
model
to
a
broader
range
of
government
services,
provided
fees
remain
affordable.
Ms Karina Wong, 2025 Greater China Divisional President stated, “Our proposals are designed to help the government navigate fiscal challenges, attract investment and strengthen Hong Kong’s global competitiveness. A cornerstone of Hong Kong’s success has been its low and simple tax system, and this must be preserved. Therefore, we encourage the government to prioritise raising revenue from non-tax sources, such as modestly raising fees on some government services.
Ms Wong highlighted that unlike Hong Kong, other advanced economies generate significant revenue through various levies, fees, and charges. She noted for example that Hong Kong generates only about 1 per cent of the revenue Australia does from visa processing fees and Hong Kong’s passport fees are much lower than many jurisdictions. “While we are not suggesting the government raise fees to match those of other advanced economies, there is scope for modest adjustments to better reflect their costs,” she said.
To support this, CPA Australia recommends the adoption of standardised cost-recovery policy, provided fees are set at affordable rates and increases limited. To drive efficiencies, the cost-recovery fee should be set at the cost of efficient service delivery rather than the actual cost, which could be higher.
Additional revenue-generating proposals include raising fines and penalties, such as illegal parking fines and increasing tobacco duty from 65 per cent of the cost of a packet of cigarettes to the World Health Organization (WHO) recommended 75 per cent. We also suggest exploring highly targeted new taxes, such as a digital services tax on large digital providers and a carbon tax on major greenhouse gas emitters.
Attract
foreign
investment
and
corporations
To
attract
more
investment
funds
and
family
offices
to
Hong
Kong
and
encourage
them
to
invest
locally,
we
recommend
further
enhancements
to
the
tax
regimes
for
investment
funds
and
family
offices.
Mr Anthony Lau, co-chairperson of CPA Australia’s Greater China Taxation Committee suggested “To boost the property market, Hong Kong should include local real estate investments, both residential and non-residential with a minimum investment requirement of HK$50m, as tax exempt assets under unified fund exemption and single family office concession regimes, capped at 30 per cent of total assets under management. Another measure related to supporting the property sector is to give first home buyers a temporary stamp duty reduction of 50 per cent. This could help young Hong Kongers buy their first home, which not only benefits them but the broader economy and society.”
Mr. Lau also said “The Hong Kong Government can initiate consultations with the Central Government to establish a “Family Office Connect” channel to facilitate cross-border investments by Mainland high-net-worth individuals through family offices established in Hong Kong. The first step in implementing this scheme would be to pilot it in the Greater Bay Area before extending it to the rest of the Mainland.
On infrastructure, Mr Lau emphasised the importance of timely delivery of major projects despite fiscal constraints. “To maintain Hong Kong’s competitiveness, we suggest the government consider the broader use of public-private partnerships for infrastructure projects. This approach helps to reduce the government’s share of costs and risks.”
Support
SMEs
and
attract
talent
Small
and
medium-sized
enterprises
(SMEs)
have
faced
numerous
challenges
in
recent
years.
Mr
Janssen
Chan,
co-chairperson
of
CPA
Australia’s
Taxation
Committee
for
Greater
China
proposes,
“In
light
of
the
difficulties
faced
by
SMEs,
it
is
crucial
for
the
government
to
continue
supporting
them
to
foster
their
growth
and
success.
We
suggest
increasing
the
threshold
for
the
half
profits
tax
rate
from
HK$2
million
to
HK$3
million,
and
provide
a
100
per
cent
tax
rebate
on
the
2024/25
final
profits
tax,
capped
at
HK$10,000.”
To address talent shortages and support an ageing workforce, Mr Chan proposes incentives for employers hiring older workers. “We recommend offering companies an additional tax deduction on salaries paid to employees aged 60 or above, or a direct wage subsidy to employers hiring eligible older employees.”
To support the government’s “Study in Hong Kong” initiative, we suggest incentivising developers to convert industrial buildings into student accommodation and extending the Immigration Arrangements for Non-local Graduates (IANG) visa duration to four years for graduates pursuing further studies abroad.
Improve
living
standards
and
encouraging
childbirth
Acknowledging
the
need
to
balance
fiscal
responsibility
with
financially
supporting
residents,
Mr
Adam
Chiu,
a
member
of
CPA
Australia’s
Taxation
Committee
for
Greater
China
said,
“Though
we
need
to
manage
our
expectations
on
the
sweeteners
for
the
coming
fiscal
year,
we
recommend
the
government
maintain
the
100
per
cent
tax
rebate
on
the
2024/25
final
salaries
tax,
subject
to
a
ceiling
of
HK$10,000,
and
salaries
tax
allowances
should
be
increased
at
least
in
line
with
the
inflation.”
Mr Chiu also noted the potential for Hong Kong to adapt international examples on encouraging childbirth. “Hong Kong’s ageing population and low birth rate pose significant long-term consequences for the city. To help address these issues, the government should consider measures that help alleviate the financial burden of raising children, such as a childcare expense allowance with a maximum deduction of HK$60,000 and increase the child allowance to HK$150,000 per child and childcare and early childhood education subsidies,” Chiu added.
CPA Australia’s budget recommendations reflect a comprehensive approach to fostering sustainable economic growth while addressing the pressing challenges facing Hong Kong’s economy.
https://www.cpaaustralia.com.au/
https://www.linkedin.com/school/cpaaustralia/
Hashtag: #CPAAustraliaHongKong
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