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2009-2010 Budget Consultation Forum


The brand Hong Kong

Budget Speech

2008-09 Outturn

16.      I estimate that operating expenditure for 2008-09 will be $260 billion. As it covers the costs of various one-off measures to provide relief and to leave wealth with the people, operating expenditure for 2008-09 will be higher than that for 2007-08 by 27 per cent.

17.      As regards operating revenue, although I have taken into account in my last Budget a number of tax concessions, the lagging effect of the rapid economic growth in 2007-08 led to higher-than-expected revenues from profits tax and salaries tax this year. Besides, the impact of the financial crisis on tax revenue has yet to be fully reflected in 2008-09. Therefore, I estimate that operating revenue for 2008-09 will be $278 billion, $28.6 billion higher than the original estimate.

18.      For capital revenue, land premium is estimated at $16.9 billion, which is $26.2 billion lower than the original estimate of $43.1 billion, a decrease of 73 per cent over 2007-08.

19.      For capital works expenditure, excluding the $21.6 billion endowment to the West Kowloon Cultural District Authority, the revised estimate for expenditure on government works projects for 2008-09 is $23 billion, $1.2 billion higher than the original estimate of $21.8 billion and an increase of 12 per cent over the $20.5 billion spent in 2007-08. I expect an even larger increase in capital works expenditure in 2009-10.

20.      Overall, I forecast a surplus of $18 billion in the Operating Account and a deficit of $4.9 billion in the Consolidated Account for 2008-09. This deficit, equivalent to 0.3 per cent of our GDP, is close to the deficit of $7.5 billion in the original estimate. This can be regarded as achieving fiscal balance. Fiscal reserves are forecast to stand at $488 billion by end March 2009.










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Last revision date : 25 February, 2009