Shenzhen wants to team up with Hong Kong to develop its Qianhai financial zone and make a joint push for policy breaks from Beijing, Ming Pao Daily reported Tuesday.
To seal the deal the Qianhai administration is offering a flat 15 percent personal and profit tax rate, and a business tax waiver to Hong Kong companies setting up shop in the special zone, the report said. The zone will also reserve around one-third of its floor space for Hong Kong firms.
But the Hong Kong government is cautious about the idea and still has to determine whether the deal would mean new opportunities for Hong Kong’s financial and services sector or would simply drain away capital.
Shenzhen party secretary Wang Rong and mayor Xu Qin are expected to try to drum up support for the idea as they head up a delegation on a three-day trip to Hong Kong from Thursday.
Only 10 percent of the companies registered in Qianhai are from Hong Kong.
Joe Fang, from the Consultative Committee on Economic and Trade Co-operation between Hong Kong and the Mainland, said it makes sense for Qianhai to team up with Hong Kong in lobbying for more policy support from the central government given that Hengqin has a similar arrangement with Macau.
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