15 per cent stamp duty
To rein in the city's runaway housing prices, Hong Kong's Financial Secretary John Tsang Chun-wah announced an additional 15 per cent stamp duty on non-permanent-resident and corporate buyers starting from October 27, 2012. The move prompted speculation over the effectiveness of taxation on the real estate market and criticisms that Hong Kong was turning away from its roots as a free market economy in favour of a more protectionist market environment.
CY phoned Beijing to clear stamp duty policy
DAB chairman's revelation that CY telephoned Beijing to clear a new stamp duty last October sparks fears over the mainland's influence
The influence of mainland authorities on Hong Kong policy has been thrown under the spotlight by the exposure of a sensitive phone call, which Chief Executive Leung Chun-ying has refused to acknowledge.
The call was made by Leung to Wang Guangya, the director of the State Council's Hong Kong and Macau Affairs Office in Beijing, a few hours before a new stamp duty aimed at non-local homebuyers - mainlanders included - came into force last October.
The revelation raised concerns among scholars and pan-democrats that the two governments were collaborating too much on policy matters.
Tam Yiu-chung, chairman of the Democratic Alliance for the Betterment and Progress of Hong Kong, confirmed yesterday that Wang had talked about the call when meeting pro-establishment lawmakers during a meeting in Shenzhen on Sunday.
Wang was reported to have said the Chinese Ministry of Commerce should have also been consulted, but told Leung to "go ahead" anyway, reassuring the chief executive that he would shoulder any consequences.
The chief executive's office said Leung had "no comment" on the report.
Transport and Housing Minister Professor Anthony Cheung Bing-leung also declined to comment.
Democratic Party "super seat" lawmaker Albert Ho Chun-yan called the stamp duty "an internal affair" which, according to the Basic Law, should be handled solely by the local government.
"I don't understand why Leung Chun-ying needed to get approval from Wang," Ho said. "I'm worried how often this kind of thing happens."
Professor Ma Ngok, from the department of government and administration at the Chinese University, said the revelation showed Hong Kong had little autonomy under Leung's administration.
"This is obviously an internal matter. Why did it have to be shouldered by Wang?" Ma asked.
But executive councillor and lawmaker Jeffrey Lam Kin-fung said it was perfectly acceptable for Leung to maintain such contact with Wang's office.
"There is a mechanism for the chief executive to report his duties to the central authorities," Lam said. "Communication is always the best way for resolution of certain issues."
The Leung administration has repeatedly tried to calm residents' fears of mainland pressure on a range of issues, from restrictions on baby milk formula exports to the pace of expanding the multiple-entry visitor scheme.
In a Legislative Council subcommittee session yesterday, lawmakers pressed the Food and Health Bureau to review its proposed statutory definition of infant "powdered formula" under the Import and Export (General) Regulations, saying the present wording was too equivocal.
Civic Party lawmaker Dennis Kwok Wing-hang said even Horlicks powder potentially fell under the definition of "substance that appears to be for consumption by a person aged under 36 months", under the current legislation.
About 380 people have been arrested for breaching the export limit of two cans since it took effect this month, according to the Customs and Excise Department.