Small surplus forecast

PUBLISHED : Saturday, 14 February, 1998, 12:00am
UPDATED : Saturday, 14 February, 1998, 12:00am

Nikko Research Centre yesterday predicted next week's Budget would contain 'no frills and no surprises'.

Nikko believes the Government will maintain its non-interventionist approach and deliver either a balanced or small surplus Budget.

'This Budget is regarded as one of the most important in recent years as, first, it is the Special Administrative Region's first full budget and, second, the economy is currently facing serious challenges,' Nikko said.

Reduction in corporate tax, relief on mortgage interest, property tax reductions and cuts in stamp duty on property transactions were all unlikely, Nikko said.

There could be a rise in the basic salary tax allowance of less than 10 per cent, but more than the forecast inflation rate of 5 per cent and some profit tax incentives for selected sectors, such as research and development.

'One-off measures like tax rebates or a delay in tax payments cannot be ruled out,' Nikko said. 'These measures could provide real and immediate benefits to taxpayers and ultimately contribute to the economy.'