The 2021/22 Budget: Key Highlights for Business

The 2021/22 Budget: Key Highlights for Business
Hands of female entrepreneur working with bills and documents

The Financial Secretary, Mr. Paul Chan Mo-po, announced the 2021/22 Budget on February 24, 2021, proposing to introduce several measures for businesses and individuals.

We have integrated some of the budget highlights for you.

Supports for Businesses

Tax and other government fees are waived or reduced, including

  • A waiver of the business registration fees of HKD250 for the year 2021/22.
  • A 100% reduction in profit tax for the year of assessment 2020/21, subject to ceiling HKD10,000.
  • A rates concession of non-domestic properties for the year 2021/22, subject to a ceiling of HKD5,000 per quarter in the first two quarters and HKD2,000 per quarter in the remaining two quarters.
  • A 75% reduction of water and sewage charges for non-domestic households, which in commercial or industrial buildings and ground floor shops, for a period of 8 months, subject to a monthly cap of HKD20,000 and HKD12,500 per household respectively.
  • A 75% reduction in rent and fees for eligible Government properties or short-term tenancies (STTs) and waivers of a period of 6 months. If the business is closed at the Government’s request, it must be 100% waived.

SME Financing Guarantee Scheme

Besides, SME Financing Guarantee Scheme guaranteed by Government will extend the application period of 100% guarantee the low-interest loan for enterprises to the end of 2021, raise the loan ceiling to HKD 6 million, extend the repayment period and the duration of principal moratorium.

For Individuals

Electronic consumption vouchers

The Government will first issue electronic consumption vouchers to the public, unlike the previous practice of HKD10,000 cash handout.

Each eligible Hong Kong permanent resident and new arrival aged 18 or above can receive HKD5,000 e-vouchers in instalments for use at local merchandises.

Special 100% Loan Guarantee

The Budget introduces a new Special 100% Loan Guarantee for the unemployed, with a maximum of HKD80,000, a 6-month application, fixed 1% per annum interest rate and maximum repayment period of 5 years.

More, the loan offers a principal moratorium for the first 12 months, interest is refundable upon full repayment as scheduled.

Taxes, rates and Subsidies

  • A 100% reduction in salaries tax and tax under personal assessment for the year of assessment 2020/21, subject to ceiling HKD10,000.
  • A rates concession of domestic properties for the year 2021/22, subject to a ceiling of HKD1,500 per quarter in the first two quarters and HKD1,000 per quarter in the remaining two quarters.
  • A subsidy of HKD1,000 per residential electricity account.
  • An extra half-monthly allowance of standard Comprehensive Social Security Assistance (CSSA) payment, Old Age Allowance (OAA), Old Age Living Allowance (OALA) or Disability Allowance (DA). Similar arrangements also apply to the Working Family Allowance and Individual-based Work Incentive Transport Subsidy.

Stamp Duty and Vehicle registration tax

Along with the increase in subsides or fee waivers, the Budget will increase Stamp Duty and vehicle registration tax.

The Stamp Duty on Stock Transfers will be raised by 30% to 0.13% from the current 0.1% of the value of each transaction payable by buyers and sellers respectively. For vehicle registration, the first registration tax for all private cars (including electric cars) will be increased by 15%, and the license fee will be increased by 30%.

The above measures have yet to be approved by the Legislative Council, so GET READY NOW and you will be able to deal with it as soon as the details are announced!

We also provide Accounting & Taxation and Corporate Services, please do not hesitate to contact our professional team at 2159 8001.

In addition to the above measures, the Government has announced a series of policies to support individual sectors and housing. For more information on Budget, please visit the following website,

https://www.budget.gov.hk/2021/eng/index.html