The Hong Kong Investment Fund Association is calling on the government to provide tax concessions for employees’ voluntary contributions to the Mandatory Provident Fund, the Hong Kong Economic Journal reported on Friday.
A matching funding scheme should also be offered to employees who are not covered or only partially covered by the MPF, the association’s chairman Bruno Lee Kam-wing said.
It is suggested that a maximum tax allowance of HK$50,000 be given to taxpayers for their voluntary contributions to the MPF scheme in order to encourage them to raise their input above the statutory 5 percent of their monthly income.
According to a recent survey by the association, 51 percent of taxpayers are willing to contribute extra to the MPF scheme to gain at least HK$31,000 of tax allowance, Lee said.
A maximum matching ratio of 30 percent, or HK$30 for each HK$100 contribution, from the government is also among the association’s recommendations to cover low-income individuals and housewives, who number about 1.7 million people.
On the other hand, withdrawal restrictions and contribution limits should be defined to avoid abuse of the matching funds and tax concessions.
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