Still, most bank industry employees can relax. The step is expected to have a very modest, even minimal, impact on senior and client-facing staff in the city.
Any change in a tax system by a government usually means that somewhere, somehow ends up coughing out more money. That now seems to hold for Hong Kong even though it has one of the lowest tax rates in the world.
Still or because of that, the government intends to introduce a two-tiered salary tax system starting this financial year, according to the 2024-25 budget released yesterday.
Slight Increase
That means that those whose net income exceeds HK$5 million (about 640,000 US dollars at current exchange rates) will have to fork out a bit more, but not all that much.
They will continue to be taxed at a rate of 15 percent for the first 5 million dollars in income, but they will be taxed 16 percent for anything above that level.
Few Affected
According to the government, the step will affect about 12,000 taxpayers, accounting for about 0.6 percent of all salaries. Regardless, the government seemed relatively comfortable with taking the step, which is expected to add about HK$910 million to government coffers.
«Even with the two‑tiered standard rates regime above in place, the new tax rates will still be lower than those of other advanced economies,» it said.
Letting You Know
Still, you can expect some grumbling at city restaurants and bars on the weekend, about it.
If for nothing else, the coddled expatriate set, and a certain kind of senior banker, will want to let you know indirectly, yet relatively explicitly, how much they earn.
