Views on the Inland Revenue Ordinance

"That, in order to further strengthen and expand Hong Kong's edge as an ideal place for investment in the international arena, this Council urges the Government to, under the principle of maintaining a simple tax regime with low tax rates, examine the specific issues relating to Hong Kong's taxation system and the implementation of the Inland Revenue Ordinance, with a view to enhancing Hong Kong's competitiveness and its attractiveness to international investors."

In his speech in the motion debate, the Secretary for Financial Services and the Treasury remarked that the Government's present approach of keeping various tax items under constant review would enable it to make timely adjustment to our taxation policy and tax regime so as to cope with the changes in economic environment and mode of business. In-depth studies on specific major issues would be more effective than a comprehensive review of the tax law and would better meet the actual needs of Hong Kong. Furthermore, the existing mechanism is very effective in enabling the Government to know the views of the relevant professions, business community and other sectors on taxation policy and tax law. There is no need to set up another advisory body. The Government supported Hon Patrick LAU Sau-shing's amendment to the motion. A more pragmatic approach to taxation matters is to conduct systemic in-depth discussions on the specific issues of concern to the industry. This would be more effective and practical than deploying enormous manpower and resources to conduct a review of the Inland Revenue Ordinance and the relevant subsidiary legislation, which runs for hundreds of pages, without any definite directions, objectives or focus.