Hong Kong budget sweeteners help lift some of family's cash burden
Measures, including improved child allowances and rebates, are aimed at middle-class taxpayers
With two children and a mortgage to pay off, Matchy Choi Shun-yin and his wife Teresa are one of the many middle-class families in the city that should benefit from the range of sweeteners in the budget.
Child allowances and rebates are among some HK$34 billion in one-off relief measures announced by Financial Secretary John Tsang Chun-wah yesterday, with the aim of "alleviating the financial burden on the public".
At least 1.8 million taxpayers will pay 75 per cent less on salaries tax - this time capped at a higher HK$20,000 - while profits tax is to be reduced by the same amount, benefiting 130,000 taxpayers.
Other one-off relief measures promised by Tsang include an increase in the basic and additional child allowances, from HK$70,000 to HK$100,000 in 2015 to 2016. The owners of 3.1 million properties will also see rates waived for the first two quarters of the coming financial year - subject to a HK$2,500 ceiling per quarter for each property.
"The middle-class taxpayers paying progressive rates will feel the impact of the increased child allowance the most," said Barbara Forrest, tax partner at KPMG China.
Florence Chan Yuen-fan of the Institute of Certified Public Accountants agreed, saying the measures were "surprisingly generous", with middle-class earners having much to gain. "The income tax rate is already very low to begin with," she said.