To alleviate the financial burden suffered by individuals and businesses under the COVID-19 crisis, stimulus package of a total HK$287.5 billion1 (approximately 9.5% of Hong Kong’s gross domestic product) has been unveiled by the Hong Kong Government. Key measures include:
- A reduction of profits tax payable for the year of assessment 2019/20 by 100%, subject to a ceiling of HK$20,000.
- A reduction of salaries tax payable and tax payable under personal assessment for the year of assessment 2019/20 by 100%, subject to a ceiling of HK$20,000.
- Waiver of the surcharge for up to one year on tax payments for the year of assessment 2018/19 deferred under an approved instalment plan.
- Delaying by one month, the issuance of profits tax returns to 4 May 2020 and salaries tax returns to 1 June 2020 for the year of assessment 2019/20.
- Extending the deadlines for filing to 4 May 2020 of objections and holdover applications as well as for filing due date of tax returns that fall between 23 March 2020 and 2 May 2020.
- Extending to 1 June 2020 the date for filing country-by-country reporting notification for entities with accounting periods ended between 31 December 2019 and 29 February 2020.
- Deferring by three months the deadline for payments of profits tax, salaries tax and tax under personal assessment for the year of assessment 2018/19 due in April, May and June 2020.
- Proposed to offer a profits tax exemption to qualifying ship lessors and a 50% profits tax concession to qualifying ship leasing managers in future years.
- Providing tax concession for certain carried interest issued by private equity funds operating in Hong Kong subject to the fulfilment of certain conditions starting form 2020/21 upon completion of the legislation exercise.
Employment Support Scheme ($80 billion):
- All employers making Mandatory Provident Fund (“MPF”) contributions will be eligible except those on exclusion list (Hong Kong Government, statutory bodies, and Government subvented staff).
- Wage subsidies of up to HK$9,000 per month per employee (capped at 50% of monthly median wage at 2019 Q2 of HK$18,000) for six months will be provided to eligible employers in return for undertaking not to implement redundancy.
- Payment to employers in two tranches, first payout no later than June 2020.
- Employers have to undertake not to implement redundancy.
- For self-employed persons who have made MPF contributions, a one-off lump sum subsidy will be provided.
- Employers in other sectors such as catering, construction and transport (mainly taxi and red mini-bus drivers) which are not fully covered by the MPF scheme will be assisted in the sector-specific schemes.
- Relax asset limits of the Comprehensive Social Security Assistance Scheme for six months to assist the unemployed.
Creating 30,000 time-limited jobs (~ HK$6 million) in both public and private sectors in the coming two years;
Six measures to encourage staffs to learn new skills and help enterprises to apply technology.
- LAWTECH fund (~ HK$40 million): technical support and training for SME law firm/ barristers’ chambers.
- COVID-19 Online Dispute Resolution (ODR) scheme (~ HK$70 million): to provide ODR services for dispute related to or arising form COVID-19.
- Encourage Deployment of 5G (~ HK$60 million): to subsidize the public and private sectors 50% of their 5G deployment projects.
- Distance Business Programme (~ HK$500 million): to support enterprises to continue business with technology adoption and related training.
- Training Subsidies for the Construction Sector (~ HK$30 million): training subsidies for consulting firms under the Construction Industry Council.
- Matching Grants for Skills Upgrading (HK$100 million): matching grants for training programmes for staff in the public and private sectors.
A total of $51 billion relief will be provided to hard-hit sectors including:
|Tutorial schools||Local primary producers||
School-related service providers
|SME Exchange participants and Securities and Futures Commission (“SFC”) licensees||
|Registered sport coaches||Licensed estate agents and salespersons||Non-profit making organizations running various heritage and open space projects|
|Interest class instructors to social service centres||Passenger transport sector (e.g. Taxi/red minibus owners/drivers, non-franchised bus, etc.)||Aviation industry (e.g. airlines and aviation support services and cargo facilities operators)|
|Private refuse collectors||Cinemas, design hub at PMQ and printing and publishing sector||Catering outlets|
|Sectors which are completely or partly closed due to the measures for safeguarding public health imposed by the Government (e.g. amusement game centre, fitness centre, place of amusement, beauty parlour, massage establishment etc.)|
- Enhancing the SME Financing Guarantee Schemes by:-
- Increasing the maximum loan amount per enterprise:
- 80% guarantee HK$15M→ HK$18M
- 90% guarantee HK$6M→ HK$8M
- 100% guarantee HK$2M→ HK$4M
- Provide concessionary interest at a rate up to 3% for one year for loans under 80% and 90% Guarantee
- Raising the guarantee commitment for the Special 100% Guarantee Product from HK$20 billion to HK$50 billion to meet businesses’ demand
- Increase government rental concessions for tenants and hirers of government premises from 50% to 75% for the period April to September 2020
- Increase government rental or fee concessions from 50% to 75% for eligible Short Term Tenancies and waivers administrator by Lands Department for the period April to September 2020
- Extend the 75% waive of water and sewage charges payable by nondomestic accounts for a further 4 months to November 2020
- Waive registration/enrolment fees for healthcare professionals for 3 years
- Reduce MTR fares by 20% for 6 months from 1 July 2020, with Government paying for half of the revenue forgone
- Relax the monthly threshold from HK$400 under the Public Transport Fare Subsidy Scheme to HK$200 for 6 months from July 2020
- Grant interest-free deferral of loan repayment for 2 years to self-financing post-secondary institutions and non-profit-making international schools
- Grant automatically (i.e. without application) interest-free deferral of loan repayment for 2 years to all student loan repayees (except those on default)
- Airport Authority – additional relief of HK$2 billion to airlines and its immediate supporting operators.
- Hong Kong Monetary Authority – adjust regulatory parameters to enable banks to lend, releasing a total lending capacity of HK$1,000 billion, and provide to clients “Principal moratorium” for a specified period and other sector-specific measures to help provide liquidity to businesses, especially the SMEs.
- Insurance Authority – facilitate all major insurance companies to offer grace period of premium payment up to 30 to 180 days for holders of individual life, critical illness and medical policies for a specified period.
- All Government bureaux and departments – extend the deadline for project completion and /or relax the payment schedules of government work and non-works contracts and extend the Building Covenant period by up to 6 months in land leases.
- Waiver of business registration fees for 2020/21.
- Waiver of registration fees for all annual returns for two years.
- One-off cash payout of HK$10,000 to each Hong Kong Permanent resident aged 18 or above.
- Waiver of rates for four quarters of 2020/21, subject to a ceiling of HK$1,500 per quarter for each rate-able residential property/HK$5,000 per quarter for the first two quarters and HK$1,500. per quarter for the remaining two quarters for each rate-able non-domestic property.
- Extra allowance to Comprehensive Social Security Assistance payments, Old Age Allowance, Old Age Living Allowance and Disability Allowance recipients, equal to one month of the allowances.
- Paying one month's rent for lower income tenants living in public rental units Subsidy to each eligible non-domestic household accounts for four extra months to cover 75% of their monthly billed electricity charges, subject to a monthly cap of HK$5,000 per account.
- Special grant to aided and non-aided children care centres, Employees Retraining Board’s appointed training bodies.