For Immediate Release
The Hong Kong General Chamber of Commerce (HKGCC) welcomes the carefully crafted measures announced by Financial Secretary Paul MP Chan in his Budget Speech today, designed to foster innovation and stimulate investment amid a challenging economic environment while balancing the need to reduce costs with investing in Hong Kong’s future growth.
“We support this sensible and logical budget, especially given the challenges that the Financial Secretary faces with the budget deficit,” said Chamber Chairman Agnes Chan. “It is also encouraging to know that the projected deficit will be brought to balance in a few years’ time.”
The HKGCC is pleased to note that the Budget includes its proposals to enhance fiscal management and efficiency. Measures to reduce civil service positions by 2% each in 2026-27 and 2027-28, while capping the $2 transport subsidy scheme at 240 monthly trips – with eligible users paying 20% of fares over $10 – will maintain affordability while ensuring financial sustainability.
Measures to increase revenues through various taxes and fees, including cross-boundary private car journey fees, tunnel tolls and parking fees, should provide additional steady revenue streams without overly burdening the public. Implementing a global minimum tax to address base erosion and profit shifting (BEPS 2.0) will generate significant government revenue of $15 billion annually.
To put more money in the public’s pockets and hopefully stimulate consumption, support measures such as a 100% reduction in salaries tax and profits tax (capped at HK$1,500), and concessions for residential and non-residential property rates, among others, will provide financial relief and encourage consumer spending, thereby stimulating the economy.
Injecting HK$1.5 billion into existing funds to support SMEs, including the BUD Fund, will enable them to upgrade their businesses. The newly announced “E-Commerce Express” programme will further facilitate SMEs’ access to the Mainland market.
The Chamber is pleased to see the Government adopt its proposal to issue bonds to fund infrastructure projects that are crucial for developing Hong Kong’s future growth and competitiveness. “With the Northern Metropolis' annual capital works expenditure expected to reach up to $120 billion over the next five years, it makes sense for the Government to issue bonds to fund this and other essential projects,” said Chan. She added that the ratio of government debt to GDP would be around 12% to 16.5%, which is manageable and much lower than many advanced economies.
The Chamber believes that innovation and technology will be core pillars supporting Hong Kong’s competitiveness, so it welcomes the Financial Secretary’s emphasis on expediting projects, including earmarking $3.7 billion for phase 1 of the Hong Kong Park in the Hetao Cooperation Zone.
Similarly, budgeting $1 billion to establish the Hong Kong Artificial Intelligence Research and Development Institute and allocating $100 million for companies to upgrade production lines and develop talent should advance Hong Kong’s competitiveness in the coming decade.
The low-altitude economy is another area of growth for Hong Kong. The Chamber looks forward to reviewing the findings from the sandbox and working with the Government to develop relevant legislation to support this sector’s healthy development, Chan added.
It is also important to accelerate green development. Launching a $300 million subsidy scheme to install 3,000 fast chargers across Hong Kong, as well as promoting the application of sustainable aviation fuel and green marine fuel, will reinforce Hong Kong’s position as a green transportation hub.
The allocation of additional funds to the culture and tourism industries will significantly enhance Hong Kong’s global appeal among travellers seeking diverse experiences, further boosted by introducing international mega events.
“In the face of geopolitical uncertainty, economic restructuring in Hong Kong, and a fiscal deficit resulting from support measures provided to businesses and the public during the pandemic, this Budget takes into account the needs of various stakeholders, offers incentives, and controls costs while supporting Hong Kong's long-term development through bond issuance,” said Chan. “HKGCC is committed to working closely with the Government to promote these initiatives, support the business community, and reinforce Hong Kong’s status as an international financial hub.”
Media inquiries: Please contact Ms Chloe Lee at 2823-1297 / clee@chamber.org.hk