Study Buddy (Challenger): Takeaways from Paul Chan’s 2023-24 financial blueprint – ‘Happy Hong Kong’, tax breaks and more
- Financial secretary sets sights on higher taxes for smokers, while unveiling cheaper stamp duty for permanent residents buying small to medium-sized flats for first time
- This page is for students who want to take their understanding to the next level with difficult vocabulary and questions to test their inference skill
Financial Secretary Paul Chan’s (second from left) financial blueprint includes increasing the tobacco duty. Photo: Elson LiContent provided by British Council
Read the following text, and answer questions 1-9 below:
[1] Financial Secretary Paul Chan Mo-po unveiled his annual budget blueprint for Hong Kong last month with the city seeking to recover from the Covid doldrums. Here are some takeaways from the budget address.
[2] To alleviate the public’s burden, Chan announced – much like in previous years – a reduction in salaries tax by 100 per cent, subject to a ceiling of HK$6,000, as well as a subsidy of HK$1,000 on electricity. Chan also unveiled a relief measure for permanent residents buying small to medium-sized flats for the first time. Qualified homebuyers will pay cheaper stamp duty if they buy a home valued at less than HK$9 million.
[3] With a goal to cut the smoking rate from 9.5 per cent to 7.8 per cent by 2025, the finance minister increased the tobacco duty by 60 HK cents per cigarette with immediate effect. A pack of cigarettes is estimated to cost more than HK$70 under the new measure, up from the current HK$60. Duties on other tobacco products will also be increased by the same proportion.
[4] Chan introduced a new campaign: “Happy Hong Kong”. The finance minister said this campaign would focus on residents and include a raft of events, such as a gourmet festival and a mega carnival over sea and land. Chan also announced another round of HK$5,000 consumer vouchers to boost spending. Non-Hong Kong residents living in the city under various visas will receive HK$2,500 in the next round.
[5] Hong Kong also unveiled the Capital Investment Entrant Scheme, which gives those investing in the local asset market a chance to move to the city. The initiative will work in tandem with other recent policies aiming to attract professionals and top university graduates. Chan also vowed to nurture talent, especially in sectors such as financial services, logistics, innovation and technology as well as construction.
[6] The government will launch a fintech internship scheme for post-secondary students, which will offer subsidies for those based in Hong Kong and the Greater Bay Area. Chan said authorities would inject HK$200 million into the Maritime and Aviation Training Fund to provide training and smart logistics, in addition to launching a new trainee programme for those pursuing a career in maritime law.
[7] The financial secretary said the Pilot Scheme on Community Care Service Voucher for the Elderly had also received the green light to fully launch this year and aimed to increase its coverage from 8,000 residents to 12,000 in 2025-26. The annual number of elderly patients covered by the Hospital Authority’s Integrated Discharge Support Programme would also be increased from 33,000 to 45,000 during this year’s third quarter. He also proposed increasing the tax deductions offered under MPF contributions made by employers to 200 per cent from 100 per cent to encourage the employment of those aged 65 – the city’s retirement age – and above.
[8] To support Hong Kong’s young generation, Chan proposed increasing the basic child allowance and additional child allowance for parents from HK$120,000 to HK$130,000 beginning from 2023-24. The move is estimated to benefit 324,000 taxpayers and reduce tax revenue by HK$610 million each year.
Source: South China Morning Post, February 22
Questions
1. Which of the following has been subsidised or lowered by the government for the 2023-24 financial year according to paragraph 2?
A. electricity consumption
B. salaries tax
C. stamp duties for certain homebuyers
D. all of the above
2. In paragraph 3, what is the Hong Kong government’s intention in increasing duties on tobacco products?
3. When will the new tobacco duty be in force?
A. September 2023
B. 2025
C. information not given
D. It is already in place.
4. What does the “next round” in paragraph 4 refer to?
5. Find a phrase in paragraph 5 that means “alongside”.
6. Which groups of people are eligible for the fintech internship scheme?
A. those who have completed secondary school
B. employees of companies that use technology to automate financial services for consumers
C. working professionals seeking a new career in fintech
D. undergraduate students majoring in maritime shipping and logistics
7. What does the government aim to achieve with the revision in tax deductions mentioned in paragraph 7?
8. Decide if the following statements are True, False or Not Given in the text. Blacken ONE circle only for each statement. (4 marks)
(i) More people will be eligible for the Hospital Authority’s Integrated Discharge Support Programme.
(ii) It will be easier for some foreign investors to obtain Hong Kong residency.
(iii) The city’s government aims to cover the entire cost of raising children with its child allowance programme.
(iv) The public has welcomed the reduction in salaries tax.
9. Match the headings in the column on the right with the respective paragraphs on the left. (5 marks)
Answers
1. D
2. to cut the city’s smoking rate from 9.5 per cent to 7.8 per cent by 2025
3. D
4. next distribution of consumer vouchers (accept other similar answers)
5. in tandem
6. A
7. to encourage companies to continue employing those aged 65 and above.
8. (i) T; (ii) T; (iii) F; (iv) NG
9. (i) Paragraph 2: B; (ii) Paragraph 3: A; (iii) Paragraph 4: E; (iv) Paragraph 5: C; (v) Paragraph 6: D