(Source : Government Information Centre)
Revenue Bill 2004 to be gazetted on Friday
The Revenue Bill 2004, which seeks to implement some of the revenue-related measures announced in the 2004-05 Budget, will be gazetted this Friday (April 23).
Under the Bill, the Inland Revenue Ordinance (Cap. 112) will be amended to effect two revenue-related measures.
The first proposal is to extend the entitlement for home loan interest deduction under salaries tax and personal assessment from five to seven years of assessment.
"Though the burden of home mortgage repayments on taxpayers in general is lighter now than when the deduction was introduced in the 1998/99 year of assessment due to the fall in property prices and the drop in mortgage interest rates, we propose to extend the entitlement period for the home loan interest deduction as a relief to all home owners and to ease the heavy financial load still borne by many families. As taxpayers who have, since 1998/99, claimed the deduction continuously will have their five-year entitlement period expire in the 2003/04 year of assessment, we propose that the additional concession take effect from the 2003/04 year of assessment. Several hundred thousand taxpayers will benefit from this measure," a Government spokesman said.
The second proposal is to extend the scope of deduction for research and development expenses under profits tax to cover design-related expenses. This proposal will facilitate the proposed "DesignSmart" initiative which aims to strengthen our support for design and innovation. It is proposed that the extension take effect from the 2004-05 year of assessment. After the proposed extension, the scope of research and development expenditure deduction allowed under our regime will compare favourably with other jurisdictions.
The cost to government revenue of the extension of the entitlement period for the home loan interest deduction is estimated to be $4.6 billion over five years, while the extension of scope of the profits tax deduction for research and development expenses will cost $30 million in a full year.
The Bill will be introduced into the Legislative Council on April 28, 2004.
Ends/Tuesday, April 20, 2004