2002-03 Annual Report, Inland Revenue Department
(Text Only)


Revenue


Whilst the economic growth in real terms did pick up slightly in 2002, revenue collections were nonetheless adversely affected by the previous year’s downturn. Coupled with the effect of the waiver of Business Registration fees in the 2002-03 Budget, there was a decrease in collections of $4.7 billion in Earnings and Profits Tax (Figure 1, Schedules 1 and 2). Stamp Duty collections also dropped by almost $1.2 billion as a result of the sluggish property and stock markets.

Figure 1 Revenue collected by tax type
Type of tax 1999-2000
(Dollars million)		 2000-01
(Dollars million)		 2001-02
(Dollars million)		 2002-03
(Dollars million)
Profits Tax - Corporations 32,333.2 38,960.5 39,272.4 33,692.9
Profits Tax - Unincorporated Businesses 5,365.3 4,008.9 5,103.3 5,106.6
Salaries Tax 24,831.5 26,302.9 28,634.6 29,733.1
Property Tax 1,167.9 1,143.1 1,135.7 1,180.1
Personal Assessment 3,216.2 3,454.9 3,603.0 3,315.9
Total Earnings and Profits Tax 66,914.2 73,870.3 77,749.0 73,028.6
Estate Duty 1,271.6 1,502.6 1,927.8 1,402.7
Stamp Duty 12,115.9 10,911.2 8,636.6 7,458.2
Betting Duty 11,937.8 12,630.1 11,571.3 10,920.7
Business Registration Fees 1,276.2 1,300.7 1,240.2 127.7
Hotel Accommodation Tax 182.4 222.5 202.9 201.0
Total revenue collected 93,698.1 100,437.4 101,327.8 93,138.9
Percentage change over previous year -7.1% 7.2% 0.9% -8.1%

Overall, revenue collected by the Department during 2002-03 totalled $93.1 billion (about 60% of the Government General Revenue, see Figure 2). This represents a decrease of $8.2 billion, or 8.1%, from that collected in the previous year. The major part of revenue collected came from Profits Tax and Salaries Tax, which together contributed some 74% (Figure 3).

Figure 2 Government General Revenue
Revenue 1999-2000
(Dollars billion)		 2000-01
(Dollars billion)		 2001-02
(Dollars billion)		 2002-03
(Dollars billion)
Inland Revenue Department collections 94 101 102 93
Other General Revenue 68 78 55 55
Total Government General Revenue 162 179 157 148
Percentage of Inland Revenue Department collections 57.8% 56.2% 64.7% 63.1%

Figure 3 Composition of the revenue collection 2002-03
Type of tax
Percentage
Profits Tax
41.7%
Salaries Tax
31.9%
Stamp Duty
8.0%
Betting Duty
11.7%
Others
6.7%

Productivity savings were achieved during the year. Despite the drop in overall revenue collections, the cost of collection of revenue decreased slightly from 1.39% to 1.38% (Figure 4).

Figure 4 Cost of collection
Cost of collection 1999-2000 2000-01 2001-02 2002-03
Percentage 1.37% 1.31% 1.39% 1.38%



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(Last updated/reviewed : February 4, 2003)