Date
28 June 2017
Widely tipped as the next Secretary for Labor and Welfare, Law Chi-kwong’s comments on the need to revisit tax policies have caused concern within the business sector. Photo: HKEJ
Widely tipped as the next Secretary for Labor and Welfare, Law Chi-kwong’s comments on the need to revisit tax policies have caused concern within the business sector. Photo: HKEJ

Law Chi-kwong just had his baptism by fire

The Democratic Party’s Law Chi-kwong, who is widely tipped as the next Secretary for Labor and Welfare, had his baptism by fire on Sunday during a live radio interview when he said that rich people and big businesses “should pay a little more tax” to help alleviate poverty in society.

His remarks immediately provoked a backlash from the business sector.

Lawmaker and Executive Councilor Jeffrey Lam Kin-fung, who is vice chairman of the Business and Professionals Alliance for Hong Kong, issued a statement the next day criticizing the idea of tax hike, and said he hopes Law’s words represented his personal views and not the stance of the incoming administration.

It appears Law slipped on a banana skin even before he officially entered the “hot kitchen”.

As a matter of fact, Law gave the interview in his capacity as a sitting member of the Commission on Poverty and a social work academic.

During the radio program Law said the introduction of capital gains tax and tax system reform should be up for discussion in society given the fact that the Gini coefficient of Hong Kong has hit record high, suggesting that wealth gap in the city is continuing to widen quickly.

However, as some in the business sector pointed out, since Law is widely tipped as the next Secretary for Labor and Welfare, his opinions on higher taxes would inevitably be taken by the public as a hint about the policy agenda of the incoming administration. As such, he should have been more discreet when talking to the media.

Besides, they added, Law would be overstepping his authority if he really proposed to impose new tax, given that tax policy is actually the jurisdiction of the Secretary for Financial Services and the Treasury. Hence, Law shouldn’t have commented on the issue in public in the first place, critics said.

Given the repercussions of Law’s remarks, it is said that on the same day he gave his interview, business leaders were given reassurance that what he said didn’t represent the next government’s position on tax policies.

In fact since the implementation of statutory minimum wage, the local business sector has become increasingly sensitive to any sign of change in the government’s tax or social welfare policies.

In the meantime, there is speculation that while Law is going to be the next Secretary for Labor and Welfare, Caspar Tsui Ying-wai of the Democratic Alliance on the Betterment and Progress of Hong Kong, who is now serving as political assistant to the incumbent Secretary for Home Affairs, would be promoted as Law’s deputy.

Sources also said Law’s political assistant is likely to come from the Liberal Party, which might perhaps help Law improve his way in dealing with the business sector, and in particular, help him avoid banana skins in the coming days.

This article appeared in the Hong Kong Economic Journal on June 14

Translation by Alan Lee

[Chinese version 中文版]

– Contact us at english@hkej.com

RC

Columnist of Hong Kong Economic Journal.

EJI Weekly Newsletter

Please click here to unsubscribe