Bid to limit Hong Kong government's power over stamp duty heads for defeat
A Democratic Party lawmaker's attempt to limit the government's power to adjust a tax introduced to cool property prices looks set for defeat after another pan-democratic party came out against his plan.
Democrat James To Kun-sun wants to force the government to seek Legislative Council permission before it increases, reduces or scraps the 15 per cent buyer's stamp duty imposed on purchases of homes by corporations or by individuals who are not permanent residents. The government favours "negative vetting", under which lawmakers would only scrutinise changes to the tax after they came into effect.
The measure has been in place since 2012, but will only formally become law when Legco passes the Stamp Duty (Amendment) Bill, which it is due to debate again on Wednesday.
To argues that "negative vetting" gives the government too much power. He has won support for the amendment from a traditional foe, the Liberal Party.
But the Civic Party has joined the Liberals' allies in the Beijing-loyalist camp, the Democratic Alliance for the Betterment and Progress of Hong Kong and the Federation of Trade Unions, in coming out against the idea.
The Civic Party's Ronny Tong Ka-wah said the party's six lawmakers would abstain or vote no, saying To's proposal went against the traditional principle of allowing the government to act on time-sensitive matters without having to wait for legislators, and would create a loophole developers could exploit. "If the tax changes went through positive vetting ... and someone filibustered out of self-interest, developers could put up new flats for sale within a short period."
New People's Party lawmaker and Executive Council member Regina Ip Lau Suk-yee agreed, saying the government needed to be able to respond swiftly to extraordinary market conditions.
But Liberal James Tien Pei-chun supported To, saying the government had failed to explain how property prices would soar without the tax.
Additional reporting by Tony Cheung