Small businesses and start-ups in Hong Kong need more than tax breaks to thrive, owners say
In the final part of a three-part series on Hong Kong leader Carrie Lam’s eagerly awaited maiden policy address, to be delivered on October 11, small-business owners welcome Lam’s expected plan to cut taxes, but say more needs to be done
Arnault Castel, who owns a small business in Hong Kong, already has plans for the money he will save from a tax cut that the city’s leader is expected to announce next week.
Castel owns seven lifestyle stores in the city under the Kapok brand, the first of which he opened in 2006. He said he planned to use the tax break to invest more in his employees.
“If I have a tax saving it may be easier for me to retain some good employees by paying them better salaries,” Castel, a French citizen who has lived in the city for 21 years, said.
Lam proposed reducing the tax rate for small businesses on the first HK$2 million of profit to below 10 per cent, from its current 16.5 per cent. She repeated that pledge at a business forum in September.
“My intention is to reduce the tax burdens on start-ups and SMEs [small and medium-sized enterprises], but to do it without changing the very simple tax system,” she said at the forum.