Hong Kong lawmakers have backed the government’s proposed tax incentives for large innovative companies, but many said on Monday that the planned five-year concession period is too short to attract major firms to establish headquarters or expand operations in the city.
Chief Executive John Lee Ka-chiu in his policy address last month said the government planned to submit a bill introducing preferential profits tax rates of either 5 per cent or 8.25 per cent, which was half of the city’s standard corporate tax rate of 16.5 per cent, for selected innovative enterprises for up to five years.
Secretary for Financial Services and the Treasury Christopher Hui Ching-yu told lawmakers at a meeting of the Legislative Council’s financial affairs panel that the incentives would be limited to specific sectors, including advanced manufacturing, finance, logistics and supply chain management, as well as to companies establishing headquarters in Hong Kong.
