Budget hailed as visionary
Reporting a historically high surplus, the first financial budget of the currentterm government was hailed as visionary, forward-looking and caring — combining a mix of one-off relief measures and long-term initiatives.
Announcing the 2018-19 Budget on Wednesday, the government said financial year 2017-18 brought a HK$138 billion surplus — over seven times more than its original estimate of HK$16.3 billion.
A 20.6 percent increase in income from higher-than-expected land premium revenues and stamp duty income — as well as a 3.5 percent cut in government spending — accounted for the massive surplus.
Fiscal reserves are expected to balloon to HK$1.09 trillion by the end of this month while the Housing Reserve will reach HK$78.8 billion.
The government pledged to share 40 percent of the surplus with the community. The remainder will be earmarked for improving services and investing in the future.
Announcing the budget, Financial Secretary Paul Chan Mo-po said: “In formulating fiscal policies, we should strive to be innovative, responding to community aspirations promptly and effectively, and making a head start to foster long-term development.”
Chief Executive Carrie Lam Cheng Yuet-ngor praised the budget, saying: “The financial secretary has fully embraced the new style of governance, the new roles of the government and the new fiscal philosophy that I have set for this term of government.
“I have every confidence that the budget will inject new impetus into Hong Kong’s economy. It also reflects a conscientious effort to address the needs of the people,” Lam said in a statement.
The government gave promoting a diversified economy, investing in the future and caring and sharing as the three main objectives of the budget.
To boost economic diversification, the government will allocate HK$50 billion for innovation and technology development. It also intends to focus on biotechnology, artificial intelligence, “smart city” and financial technologies.
A further HK$500 million will be set aside to developing the financial services industry while HK$396 million will go toward developing Hong Kong into a world-beating premier tourist destination.
Peter Wong Tung-shing, deputy chairman and chief executive of HSBC Holdings, applauded the new initiatives.
“We warmly welcome government measures in planned green-bond issuance, the proposed tax enhancements for corporate treasury centers, and tax concessions on annuity products which can help enhance Hong Kong’s competitive edge as an international financial center,” he said.