HKSAR – The government of Hong Kong has lifted the taxes imposed on the purchase of property by non-residents in a major set of reforms.
As part of the changes, the government has ended a 15% stamp duty imposed on non-permanent residents who buy property in Hong Kong and a 15% stamp duty charged on purchases of a second property.
The decision comes as home prices fell to a seven-year low, with Finance Minister Paul Chan confirming the measures in a speech presenting the territory’s budget.
The government has also raised spending on tourism promotion and as per the finance minister, all curbs, such as extra taxes, imposed earlier to cool the property market would be lifted with immediate effect.
The minister stated that given the prevailing economic and market conditions, the restrictions on property transactions were deemed unnecessary and as part of the reforms, homeowners are relieved from the obligation of paying a separate duty on sales of properties bought within a two-year timeframe.
Chan hinted at the possibility of implementing further measures to relax property lending regulations, emphasizing the importance of maintaining banking system stability.
Last year saw a halving of taxes on home purchases by non-permanent resident buyers and those acquiring additional properties, prompting a surge in shares of Hong Kong property developers.
Promoting Tourism
In a bid to enhance tourist attractions, Chan announced plans to revamp the Victoria Harbor light show and organize monthly pyrotechnic and drone displays. Additionally, $100 million Hong Kong dollars ($12.8 million) will be allocated to promote major events in the city, with an emphasis on activities like hiking and cycling, and the creation of a new tourism brand to subtly promote Hong Kong.
Efforts will also be made to collaborate with mainland Chinese cities to boost tourism in the Greater Bay Area around Hong Kong, considering mainland Chinese tourists constitute the majority of visitors to the city. Over the Lunar New Year holidays, Hong Kong welcomed nearly 1.44 million visitors, with almost 90% of them originating from mainland China.
