The Hong Kong government’s fiscal surplus for the current financial year may slide to HK$40 billion from HK$72.8 billion in the previous period, Deloitte Touche Tohmatsu estimated.
In a report Friday, the Hong Kong Economic Journal quoted Deloitte partner Yvonne Law as saying the expected decline will result mainly from a decrease in land sales and stamp duty, as stock market woes in mainland China and potential interest rate hikes in the United States are likely to drag down land prices and equity transaction volumes.
Law projected that the government’s land sales in the second half of the fiscal year ending in March will total only HK$36.1 billion, compared with HK$44.1 billion in the first half.
Meanwhile, the total stamp duty collected in the second half of the fiscal year will probably be HK$4.5 billion less than in the same period of the last fiscal year, she said.
Law called on the government to consider more relief measures if the level of the surplus allows.
Separately, she urged the government to offer more tax concessions, including a 10 percent rate of profit tax for the first five years, for foreign companies and high-tech enterprises wanting to set up operations in the city.
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