To react on the challenges from the current economic downfall in Hong Kong, the key focus for the newly released 2020-2021 Budget Report is “supporting enterprises, safeguarding jobs, stimulating the economy and relieving people’s burden”. It gives a big helping hand to all SEMs which are struggling from the unsettling year and overcome all difficulties to contribute to the economy in Hong Kong consistently. In the coming year, how SEMs can be benefited in the next financial year?
Concerning the 2020-2021 budget report, enterprises(SMEs) can be benefited in a maximum loan of 2-million and can apply a special financial relief which is more than HK$180,000:
- HK Government introduces a concessionary low-interest loan with 100% Government guarantee for enterprises, which will be opened for application for 6 months. The maximum lending amount is $2 million with repayment up to a maximum 3 year. Moratorium on principal repayment for first 6 months.
- Reduce profits tax for 2019-20 assessment year by 100%, subject to a $20,000 ceiling.
- Waive rates for non-domestic properties for 2020-21, subject to a ceiling of $5,000 per quarter in first two quarters and $1,500 per quarter for the remaining two quarters.
- Waive business registration fees for 2020-21.
- Waive registration fees for company annual returns for 2 years.
- An extra subsidy on 75% of the monthly electricity charges for the non-residential account for 4 extra months, subject to a monthly cap of $5,000.
- A relief on the water and sewage charges of non-domestic households: a waiver of 75% charges for 4 extra months, subject to a monthly cap of $20,000 and $12,500 respectively.
- Rental for Government properties/properties covered by short-term and temporary waivers: 50% reduction for 6 months
At the same time, the budget report also helps enterprises to develop local markets as well as in PRC and Oversea.
- Hong Kong Government will continue to support the sector in expanding into overseas and Mainland markets and promote the development of our professional services sector in the Greater Bay Area under the “early and pilot implementation” approach.
- To cope with the development of the Greater Bay Area and to attract more private equity funds to domicile and operate in Hong Kong, we plan to provide tax concession for carried interest issued by private equity funds operating in Hong Kong subject to the fulfilment of certain conditions.
- The Financial Action Task Force (FATF) completed a comprehensive evaluation of HongKong’s anti-money laundering and counter-terrorist financing (AML/CTF) regime including the Government will further enhance Hong Kong’s AML/CTF regime and consider incorporating virtual asset service providers and dealers in precious metals, stones and jewellery into the AML/CTF regulatory framework. We plan to consult the public on detailed proposals this year.
- Regarding the establishment of two-way wealth management connect scheme, it aims to enable residents of Hong Kong and Mainland cities in the Greater Bay Area to invest in wealth management products in each other’s market. This will create more business opportunities for the financial industries of the two places, and provide more choices for residents therein, thereby facilitating the cross-boundary flow and use of RMB.
- Leveraging Hong Kong’s platform function for taking forward Belt and Road projects, the Government will continue to support local enterprises and professional services sectors to go global with Mainland enterprises to tap overseas markets by, among other things, setting up a business in the Mainland’s overseas Economic and Trade Co-operation Zones.
- The Government has been making full efforts to introduce new fund structures, including the preparation of new legislation on the establishment of a limited partnership regime that meets the operational needs of funds, to encourage the setting up of private equity funds in Hong Kong.
Regarding the challenge of climate change, the Government pay a role in environmental protection by finical supporting to manufacturers:
- Plan to issue green bonds totalling $66 billion within the next five years,
- Setting up a $200 million Green Tech Fund to support R&D (Research and Development) and application of decarbonisation and green technologies.
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