Stop Hong Kong’s shipping industry exodus to Singapore by spending reserves on loans and cutting profits tax, advisers say
Task force set up by the government wants concessionary tax rate no higher than 8.25 per cent for firms in ship leasing management and supporting services
Hong Kong should cut profits tax by half and provide loans for vessel owners and supporting professionals to lure shipping business back from regional rival Singapore, a task force set up by the government says.
In a 34-page report released on Monday, a working group under the Hong Kong Financial Services Development Council called on officials to implement a concessionary tax rate no higher than 8.25 per cent for firms in ship leasing management and supporting services.
The figure would be half the city’s current profits tax rate on annual earnings above HK$2 million (US$255,000).
The report also suggested a Hong Kong sovereign-rated financial institution “perform a facilitating role” by helping finance securitised loans, buying shipping loans directly from banks and providing insurance for the borrowed sums.
Kenneth Lam Sze-kin, chairman of Credit Agricole Asia Shipfinance, who sits on the working group, said the recommendations were not a call for subsidies but rather an effort to “take back what Hong Kong has lost to Singapore in the past two decades” and to prepare the city for a new round of competition.