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THE HONG KONG INSTITUTE OF EDUCATION

POS2001: Governance: Concepts, Issues and Perspective

Topic 8: Overall, how would you assess the recent stamp duty changes in Hong Kong? Is this special stamp duty fair to foreign companies and non-permanent Hong Kong residents?

Stamp duties from the tax history theoretical point of view, the development of any kind of tax are related to the prevailing political and economic. In Hong Kong, Special Stamp Duty (SSD) is the government on November 20, 2010 for the pressure to curb the property market overheating additional increase in tax rate and the applicable period. Any individuals or companies in Hong Kong after November 27, 2010 that are bought the property and sold their property within 24 months (if the property is in the November 20, 2010 to October 2012, 26 disposal (including resale) or 36 months (such as property obtained on or after October 27, 2012 or transfer) of the property are needed to pay the special stamp duty.

According to the Hong Kong information service department official website, the SSD calculation methods have changed on October 27, 2012. If the property has been held for six months or less the tax rate from 15% increased to 20%.The Hong Kong government want to solve the price of property raises rapidly in this few years, so they try to adjust the SSD tax rate from 15% increased to 20% in order to adjust the balance in the market recently. Also, with the announcement by the United States Federal Reserve on the launching of the second round of "quantitative easing" policy, amounting to US$600 billion on November 3, 2010, more funds are expected to flow into the emerging Hong Kong property markets, and this will affect the strong economic fundamentals and absence of capital control here.Besides, the Hong Kong government don’t allow Co., Ltd. to buy a flat. There is no warning and

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