PRESSURE is mounting from the Legislative Council for the Government to reduce the proposed rates increase by $1.4 billion. The Liberal Party, the United Democrats and Meeting Point, which hold more than half of the seats in the 60-member council, yesterday finalised three proposals to cut the Government's rates income over the next three years. Their first suggests lowering the overall rates percentage from the existing 5.5 per cent of a property's rateable value to 5.25 per cent, and reducing the cap on the increase from a maximum 20 per cent to five per cent. The second suggests lowering the charge to five per cent, and leaving the cap at eight per cent. The third proposal suggests lowering the charge to 4.75 per cent, with the cap fixed at 10 per cent. Legislators estimated the proposals would result in a rates freeze, which would cost the Government $1.4 billion in revenue. But they differed in the long-term effect on rates income. The business-orientated Liberal Party, which had suggested a simple freeze in rates income for one year but keeping the 5.5 per cent charge, yesterday agreed with the two other parties that the rates level could be lowered. Legislator James Tien Pei-chun said: ''We are prepared to support lowering the rates level in order to win the support of the United Democrats and Meeting Point.'' United Democrat Dr Huang Chen-ya said his party hoped the Government would agree to the proposals instead of forcing them to move amendments to the Budget. Acting Treasury Secretary Kwong Ki-chi said yesterday that he would meet the three legislators on Monday. He refused to say whether the Government would agree to any one of the three proposals. ''So far, we have not received any proposals from the three parties,'' Mr Kwong said. He said the Government had to carefully weigh the impact of all three options before coming to a decision. Treasury Secretary Donald Tsang Yam-kuen, who is on leave, has said the Government would not move a resolution to impose a 20 per cent cap if legislators pressed ahead with their proposals. A removal of the cap would bring an average 34 per cent increase in rates for homes.