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(Source : Government Information Centre)

Inland Revenue (Amendment) (No.2) Bill 2001


The Government will introduce into the Legislative Council a Bill to amend the Inland Revenue Ordinance (Cap.112), which seeks to provide a legal basis for the use of passwords and telephones in filing tax returns.

"The proposed use of passwords and telefiling service will provide greater convenience for taxpayers. If the proposed amendments are accepted by the Legislative Council, the Inland Revenue Department will begin to accept tax returns filed through the Electronic Service Delivery (ESD) Scheme by passwords and through telephones from April 1, 2002 onwards. We estimate that some 800,000 taxpayers will be able to make use of the new telefiling service," a Government spokesman said.

The Inland Revenue (Amendment) (No.2) Bill contains two major proposals. Firstly, the Bill seeks to enable the use and acceptance of a password approved by the Commissioner of Inland Revenue as an alternative to the use of a digital certificate for authentication and fulfillment of signature requirement for tax returns filed under the ESD Scheme.

Since the ESD Scheme was launched in January this year, taxpayers have been allowed to file the major types of tax returns electronically through the Internet. The types of tax returns covered by the ESD Scheme include the tax returns for individuals, ie, the individual's composite tax returns for salaries income, rental income from wholly owned properties and profits from sole proprietorship business, as well as the property tax returns for co-owned properties.

However, under the present mode of operation, taxpayers need to apply to a recognised certification authority for a digital certificate and to affix their digital signature using the certificate for authentication and non-repudiation purposes.

"The purpose of the current amendment on the acceptance of passwords is to provide greater convenience for taxpayers and encourage more taxpayers to make use of the ESD Scheme to file tax returns. The department will continue to accept the use of digital certificates for tax returns filed under the ESD Scheme," the spokesman said.

The other proposal of the Bill is to allow taxpayers to file tax returns by telephone.

Currently, taxpayers may either lodge tax returns in physical form or in electronic form through the internet under the ESD. To provide greater convenience for taxpayers, the department proposes to introduce yet another mode of electronic means for filing tax returns, which is by telephone.

The Bill seeks to provide a legal basis for the acceptance of tax returns by telephone, and provides that the Commissioner of Inland Revenue shall specify eligibility criteria for cases where tax returns may be furnished by telefiling.

This telefiling service will be made available for simple salaries tax and property tax cases for individuals which meet the prescribed criteria for telefiling. The eligibility criteria will be published in the Government Gazette. The requirement that the service be available only to the simpler cases is due to practical considerations, such as the need to keep the time taken in furnishing the return by telephone within a reasonable limit.

The Inland Revenue (Amendment) (No. 2) Bill 2001 will be gazetted on November 9. The Secretary for the Treasury will introduce the Bill into the Legislative Council on November 21.

End/Wednesday, November 7, 2001