Accountants in Hong Kong back the introduction of a sales tax. They agree with the government and other supporters of the measure that it would ensure financial stability in the long run. In a report issued yesterday, the Hong Kong Society of Accountants, which has more than 21,000 members, also suggested other measures to broaden the tax base and improve quality of life. Only about 1.3 million of Hong Kong's 3.2 million working population pays tax. The government is under pressure to end its recent deficit budgeting. This year's deficit is forecast to hit $78 billion, compared with $62 billion last year. Tim Lui Tim-leung, the chairman of the society's taxation committee, said a sales tax was necessary to ensure a stable revenue source for the government in the long run. 'The tax base is too narrow for the diverse, complex and sophisticated city that Hong Kong has become,' Mr Lui wrote in the report. 'We cannot continue to rely more and more on a limited number of salaries and profits tax payers and remain competitive.' Mr Lui said the trend was for countries to move away from direct forms of taxation. He urged the government to start preparing for the introduction of a sales tax. The society proposed other measures for Financial Secretary Henry Tang Ying-yen to consider, including giving an amnesty to those who have misstated taxable earnings if they declare their under-reporting. The report also called on the government to consider a green taxation policy to help improve the environment, saying: 'The deep concern felt ... during the Sars outbreak made us all keenly aware of how important cleanliness and environmental hygiene are to our personal health, as well as to Hong Kong's image internationally.' Mr Tang will deliver his 2004-05 budget speech to the Legislative Council on March 10.