Those who reject Li Ka-shing’s idea to raise Hong Kong’s profits tax are no friends of the working class
Albert Cheng says the tycoon’s proposal should be welcomed by all levels of society, but some narrow-minded politicians in the Liberal Party have lashed out at the suggestion
Hong Kong’s already deep-rooted social conflicts are becoming increasingly serious, with a further widening of the rich-poor gap and a world-high Gini coefficient. The Occupy Central movement two years ago and the street clashes in Mong Kok earlier this year attest to the fact that such problems have intensified. Society seems on the brink of collapse.
Matters on the economic front are rather worrying. A number of key pillars spanning exports, logistics, retail, tourism and real estate are already undergoing different levels of recession. Deeply concerned with such gloomy prospects, tycoon Li Ka-shing recently suggested raising profits taxes to help increase public spending on health care and education, and narrowing the wealth gap. Most importantly, he said that measures had to be taken to help bring some hope and prospects to local communities, particularly the young generation, and address their grievances.
Li was right on the mark about the problems plaguing Hong Kong people. And his remarks indicated that, as a leader of the business community, he was prepared to pitch in and help.
Nevertheless, such noble intentions are not shared by certain local capitalists or the Liberal Party, who were quick to lash out, calling Li’s proposal a decoy against calls for a proposed “Robin Hood” tax on the super-rich and a tactic to divert Beijing’s attention from his business empire’s recent divestment moves.
Li Ka-shing calls for higher profits tax rate to tackle Hong Kong wealth gap
Hong Kong is widely known for its simple tax regime. Last fiscal year, profits tax revenue amounted to HK$140.2 billion, a 2 per cent rise over the previous year. An increase of a mere two percentage points to the 16.5 per cent rate would bring in an additional HK$17 billion. Currently, about 70 per cent of profits tax comes from big businesses and this tax alone accounts for some 48 per cent of Hong Kong’s total tax revenue.