He was responding to questions at a luncheon held by the Hong Kong Coalition of Professional Services in Wan Chai, where he also elaborated on his budget proposals.
Chan said the government is very cautious in its approach to adjusting the tax system, as competition remains intense with neighbouring regions to woo global talent and investments.
“We believe that at this point, the most important [task] for the society is to concentrate our energy on developing the economy, to fend off external risks, so we do not want to distract our minds at this time, to ignite other controversies due to discussions over the tax regime,” he said.
Separately, the finance minister said he expects the government to make extra cash in the coming financial year if Hong Kong’s stock market continues to climb in the coming months.
The SAR’s stock market has experienced a revival since the start of the year, with the daily average turnover reaching over HK$290 billion during Tuesday’s trading session, compared with the daily average of about HK$130 billion last year.
“When I was calculating for the budget…I was assuming that the daily average stock turnover will be about HK$110 billion, but now we are talking about HK$200 billion,” he said.
“Every HK$100 billion of turnover brings me about HK$130 million of stock stamp duty, so that’s about 10 percent of the total. And if the daily average turnover is about HK$200 billion dollars, that means we’ll get an extra HK$130 million of revenue each day, and there are 250 [trading] days in a year, which will be a lot of money,” he added.
