image

Li Ka-shing

Li Ka-shing calls for higher profits tax rate to tackle Hong Kong wealth gap

Tycoon also hopes next chief executive brings hope to young people, but says ‘very difficult’ to predict who it will be

PUBLISHED : Wednesday, 22 June, 2016, 1:18pm
UPDATED : Wednesday, 22 June, 2016, 11:07pm

Hong Kong’s richest man has called for a higher profits tax rate to tackle the city’s wealth gap and urged the government to provide opportunities and hope to young people.

Li Ka-shing, chairman of CK Hutchison Holdings, said the city’s next leader had to understand Hong Kong and be able to bring hope to the city.

In an interview with Bloomberg Television aired yesterday, he said it was “very difficult” to predict who would win in next year’s chief executive election.

Li Ka-shing says he’s upbeat on China’s long term outlook

“Many poor people would benefit if the profits tax rate was raised by one or two percentage points,” the 87-year-old tycoon said. “But we shouldn’t provide a free lunch.”

However, Li rejected the idea of charging higher taxes for the rich, as advocated by American ­tycoons such as Warren Buffett and Bill Gates. “You should not tax some people more and some people less or else it will be chaos,” he said.

Hong Kong has one of the lowest corporate-tax rates in the world, capped at 16.5 per cent, compared with 40 per cent in the United States.

Looking back at the youth-led Occupy protests in 2014, Li said Hong Kong was going through its toughest times in two decades. “We need to give opportunities and hope to young people.” he said.

He would not venture a guess as to who would become Hong Kong’s next leader after the election scheduled for March.

“It’s very difficult to say,” he said. “Most importantly, this person has to understand Hong Kong and fill Hong Kong with hope.”

For the 2012 race, the tycoon backed Leung Chun-ying’s rival, Henry Tang Ying-yen, whose campaign was destroyed by revelations about a massive illegal basement at his house.

Dr Li Pang-kwong, director of the public governance programme at Lingnan University, said the tycoon intended to show that he and his companies were willing to pay more tax to alleviate conflicts in society. “It’s natural for some people to have the impression from his comments on the next chief executive that the serving leader (Leung)falls short of his expectations,” the academic said.

Ivan Choy Chi-keung, a political scientist at Chinese University, described Li as one of Hong Kong’s billionaires with good political sense. “Li knows well that a deeply divided society is not conducive to a good business environment,” Choy said.