SNAPSHOTS OF HONG KONG BUDGET 2022/2023

On 23 February 2022, Hong Kong’s Financial Secretary Mr Paul Chan unveiled a costly HKD170 billion budget, including tax breaks and consumer spending vouchers as the city reels under its worst Covid-19 outbreak.

While rival financial centers are emerging from the pandemic isolation and reopening to the world, Hong Kong has found itself overwhelmed by the highly infectious Omicron variant after the city’s previously successful zero-Covid strategy crumbled.

As the city grapples with the worst wave of the pandemic, the budget adopts an expansionary fiscal policy with initiatives focusing on four areas:

• Alleviating adequate resources to support an all-out effort to win the fight against the Covid-19 pandemic;
• Relieving the hardship of people and businesses;
• Rendering support to the struggling economy and fostering post-epidemic economic revival; and
• Investing in the future by planning ahead for the medium- and long-term development of the economy.

Whilst the budget was presented in the midst of the fifth wave of the Covid-19 pandemic, it has adopted a comprehensive and forward-looking approach that caters to the immediate needs of its people and businesses. It also seeks a balance between short-term reliefs and medium-term recovery, as well as paves the way for Hong Kong’s post-pandemic economic recovery. It is therefore imperative for the government to ensure that Hong Kong will re-emerge from its current economic difficulties and rebound to new heights as a financial center in Asia; and

With this in place, it is now up to businesses to survive, grow and craft a societal fabric strong enough to withstand multifold pressures.

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© March 2022.  This article is contributed by Acutus Tax & Corporate Services Limited. All rights reserved