GOVERNMENT officials are considering whether to reverse the one per cent cut in profit tax announced in the Budget, if legislators block a proposed rates rise.
A U-turn over the corporate levy has emerged as one option to compensate for the estimated loss of $1.8 billion, if the Government has to forgo part of its rates revenue.
Chief Secretary Anson Chan Fang On-sang confirmed the Government would look at recouping any lost income if the planned rates increase was cut.
''Obviously some other areas will suffer,'' she told the Sunday Morning Post but declined to be more specific.
However Deputy Secretary for the Treasury Kwong Ki-chi - who this week meets political parties pushing for a rates reduction - said the Government would examine recouping any losses from other revenue sources, rather than cut public spending.
The profit tax option is attractive, as the $1.6 billion saving almost matches the $1.8 billion lost from a rates increase.
Such a move also has the advantage of driving a wedge between the three political parties, who are currently united on the issue.
