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Donald Tsang

Tsang's sweeteners in face of inflation

PUBLISHED : Tuesday, 11 October, 2011, 12:00am
UPDATED : Tuesday, 11 October, 2011, 12:00am

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Chief Executive Donald Tsang Yam-kuen is expected to grant a one-off allowance for welfare recipients and offer a rent-free period for public housing tenants in his final policy address tomorrow.

He will also announce the provision of several thousand subsidised Home Ownership Scheme flats each year to help aspiring homebuyers priced out of the property market.

Public tenants will probably get a two-month rent-free period while recipients of Old Age Allowance and Comprehensive Social Security Allowance will get an extra month's payment. The fresh handouts aim to alleviate the burden imposed on the poor by soaring inflation.

Tsang wrote on Facebook on Sunday that his speech would contain short-term relief measures and promised 'unconventional' policies to resolve housing problems.

It is understood he will bow to mounting public pressure to revive the Home Ownership Scheme, which was shelved in 2002 to help rejuvenate the property market.

'The resumption of the HOS scheme will not have an adverse impact on the property market in the short term because it will take at least four years for the completion of those flats,' a government source said.

Tsang will also fine-tune the My Home Purchase Scheme, announ-ced in last year's policy address, by allowing tenants to buy a flat once they apply for the scheme instead of having to rent it first.

But a government spokesman said a further reduction in profit tax was unlikely to be implemented.

During his re-election campaign in 2007, Tsang pledged to cut the city's profit tax from 17.5 per cent to 15 per cent 'if economic and financial conditions allow'.

Tsang announced a cut to 16.5 per cent in his 2007 policy address.

But the spokesman said: 'The socio-economic backdrop has changed considerably since the chief executive first made the pledge.'

 

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