MOST legislators say the narrowing of the tax base is not a problem, although a few are worried that the move will make the tax system more volatile. Next year's Budget will result in a total of 250,000 taxpayers slipping from the tax net and a further 1.2 million paying less tax. This means more than 90 per cent of taxpayers will benefit from the concessions the Financial Secretary Mr Hamish Macleod proposed. Major concessions include a 22 per cent rise of the personal tax allowance to $56,000 and the widening of the second and third tax bands by 50 per cent to $30,000. The United Democrats' spokesman on economic affairs, Dr Huang Chen-ya, said Mr Macleod's proposals were in the right direction as the past few years' Budgets had wrongly forced many people into the tax net. Dr Huang also pointed out the tax base should only be one of the considerations and it was unfair to tax people who might have problems meeting their basic needs. Mr Fred Li Wah-ming of Meeting Point said the fact that 250,000 people fell out of the tax net would not threaten the stability of the administration's revenue because he believed the tax paid by this group only made a small contribution to the Government's coffers. The views were shared by legislators from the business sector. Mr Jimmy McGregor, who is the Legco representative of the Hongkong General Chamber of Commerce, welcomed the move. Mr Martin Barrow, who is a director of the Jardine Group, also said the move did not worry him as he believed the impact on the tax system would not be great. But Mr Vincent Cheng Hoi-chuen, senior manager of Hongkong Bank's group research, said the narrowing of the tax base would make the system volatile. ''In case of an economic downturn, the Government's revenue will be affected. And, under the present political environment, it will be difficult for the administration to raise new taxes.'' A member of the Co-operative Resources Centre, Mr Henry Tang Ying-yen, said he was worried that the Government's income would be seriously affected if the economy turned bad. But he said tax concessions and the maintenance of the tax net was mutually exclusive and the raising of the personal tax allowance to $56,000 was a prudent measure.