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Budget Speech

Supporting People and Enterprises

279. To relieve the economic pressure faced by the people and enterprises, we will, having regard to the Government's fiscal position this year, introduce the following measures:

(a)  provide rates concession for domestic properties for the first two quarters of 2026/27, subject to a ceiling of $500 for each rateable property.  This measure is estimated to involve about 3.15 million domestic properties and reduce government revenue by about $3.1 billion;

(b)  provide rates concession for non‑domestic properties for the first two quarters of 2026/27, subject to a ceiling of $500 for each rateable property.  This measure is estimated to involve about 440 000 non‑domestic properties and reduce government revenue by about $400 million;

(c)  reduce salaries tax and tax under personal assessment for the year of assessment 2025/26 by 100 per cent, subject to a ceiling of $3,000.  The reduction will be reflected in the final tax payable for the year of assessment 2025/26.  This measure will benefit about 2.12 million taxpayers and reduce government revenue by about $5.3 billion;

(d)  reduce profits tax for the year of assessment 2025/26 by 100 per cent, subject to a ceiling of $3,000.  The reduction will be reflected in the final tax payable for the year of assessment 2025/26.  This measure will benefit about 171 000 businesses and reduce government revenue by about $500 million; and

(e)  provide an allowance for eligible social security recipients, equal to one month of the standard rate CSSA payments, Old Age Allowance, Old Age Living Allowance or Disability Allowance, while similar arrangements will also apply to recipients of the Working Family Allowance, altogether involving an additional expenditure of about $6.5 billion.

280.  Besides, starting from the year of assessment 2026/27, I propose:

(a)  increasing the basic allowance and single parent allowance from $132,000 to $145,000, and the married person's allowance from $264,000 to $290,000.  This measure will benefit about 2.09 million taxpayers and reduce tax revenue by about $3.56 billion a year;

(b)  increasing the child allowance and additional child allowance from $130,000 to $140,000.  This measure will benefit about 360 000 taxpayers and reduce tax revenue by about $680 million a year; and

(c)  increasing the allowance for maintaining a dependent parent or grandparent and raising the deduction ceiling for elderly residential care expenses.  These measures will benefit about 830 000 taxpayers and reduce tax revenue by about $970 million a year.  I will make the following three adjustments:

·  increasing the allowance for maintaining a dependent parent or grandparent aged 60 or above from $50,000 to $55,000.  The same increase applies to the additional allowance for taxpayers residing with these parents or grandparents;

·  increasing the allowance for maintaining a dependent parent or grandparent aged 55 to 59 from $25,000 to $27,500.  The same increase applies to the additional allowance for taxpayers residing with these parents or grandparents; and

·  raising the deduction ceiling for elderly residential care expenses from $100,000 to $110,000 for taxpayers whose parents or grandparents are admitted to eligible residential care homes.

 

 

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