33. During this critical juncture of fighting the epidemic, we must take all necessary measures to preserve the vitality of the economy, in particular the survival of SMEs, and strive to safeguard jobs. I will take measures to ease the operating pressure of businesses and enhance the cash flow support for them.
34. For easing the operating pressure of businesses, I propose:
|(a)||reducing profits tax for the year of assessment 2021/22 by 100 per cent, subject to a ceiling of $10,000. The reduction will be reflected in the final tax payable for the year of assessment 2021/22. This measure will benefit 151 000 businesses and reduce government revenue by $1.2 billion;|
|(b)||providing rates concession for non‑domestic properties for four quarters of 2022‑23, subject to a ceiling of $5,000 per quarter in the first two quarters and a ceiling of $2,000 per quarter in the remaining two quarters for each rateable property. This measure is estimated to involve 430 000 non‑domestic properties and reduce government revenue by $3.4 billion;|
|(c)||waiving the business registration fees for 2022‑23. This measure will benefit 1.5 million business operators and reduce government revenue by $3 billion;|
|(d)||continuing to waive 75 per cent of water and sewage charges payable by non‑domestic households for eight months until 30 November 2022, subject to a monthly ceiling of $20,000 and $12,500 respectively per household. This measure will benefit 250 000 non‑domestic households and reduce government revenue by $680 million;|
|(e)||extending the waivers/concessions of the existing 34 groups of government fees and charges for 12 months starting from October this year. This measure will benefit a wide range of sectors (such as aviation, maritime, logistics, retail, catering, agriculture and fisheries, construction, tourism and entertainment) and will reduce government revenue by about $1.7 billion; and|
|(f)||continuing to grant the 75 per cent rental or fee concession currently applicable to eligible tenants of government premises and eligible short‑term tenancies and waivers under the Lands Department for six months until 30 September 2022. During the period, tenants who have to close their properties at the request of the Government will continue to receive full rental waiver for the duration of the closure. This will reduce government revenue by $1.4 billion.|
35. As regards enhancing the cash flow support for businesses, I will extend the application period of all guarantee products under the SME Financing Guarantee Scheme (SFGS) for one year to the end of June next year. The Special 100% Loan Guarantee under the SFGS will also be further enhanced by increasing the maximum loan amount per enterprise from the total amount of employee wages and rents for 18 months to that for 27 months with the loan ceiling raised from $6 million to $9 million, and by extending the maximum repayment period from eight years to 10 years.
36. Besides, I have requested the HKMA to extend the Pre‑approved Principal Payment Holiday Scheme through the Banking Sector SME Lending Coordination Mechanism for six months to the end of October this year. At the same time, the HKMA and the banking sector will offer enterprises the option of making partial repayment of principal over a longer period of time. This arrangement will also apply to the loans granted under the SFGS.
37. To help small and medium‑sized exporters secure export financing from banks more easily, the Hong Kong Export Credit Insurance Corporation (ECIC) plans to launch the Export Credit Guarantee Programme on a pilot basis in March this year, under which the ECIC will guarantee up to 70 per cent of the export financing of their policyholders, subject to a maximum limit of $50 million. In addition, to encourage exporters to take larger orders from overseas buyers, the ECIC will introduce the "Flexible Indemnity Ratio" arrangement in the second half of this year to enhance insurance coverage for exporters. This measure is expected to benefit about 2 400 policyholders.
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