On 10 Jun 2026, the Information Services Department announced that the Inland Revenue (Amendment) (Tax Concessions for Shipping-related Activities and Physical Commodity Trading) Bill 2026 will be gazetted on Friday (June 12). The Bill amends the Inland Revenue Ordinance (Cap. 112) to enhance tax concessions for shipping and introduce a half-rate regime for commodity trading. A 15 per cent concessionary tax rate option is available for BEPS 2.0 compliance. The Bill will be introduced to the Legislative Council for first reading on June 24.
This article was generated using SAMS, an AI technology by Timothy Loh LLP.
SPOTLIGHT ON
FAMILY OFFICES
Legislative Announcement and Statutory Amendment
On 10 Jun 2026, the Information Services Department announced that the Inland Revenue (Amendment) (Tax Concessions for Shipping-related Activities and Physical Commodity Trading) Bill 2026 will be published in the Gazette on Friday (June 12) to amend the Inland Revenue Ordinance (Cap. 112).
Tax Concession Enhancements and BEPS 2.0 Compliance
The Bill aims to enhance existing shipping-related tax concessions and introduce a new half-rate regime for physical commodity trading to facilitate BEPS 2.0 compliance. The Government proposes a 15 per cent concessionary tax rate option for shipping-related companies to elect annually, which also applies to the physical commodity trading half-rate regime. This aligns with the Base Erosion and Profit Shifting ("BEPS") 2.0 requirements formulated by the Organisation for Economic Co-operation and Development ("OECD").
Strategic Rationale and Competitiveness
A Transport and Logistics Bureau spokesperson noted that a favourable tax regime is key to attracting shipping-related companies, with existing concessions reviewed for competitiveness post-BEPS 2.0. The spokesperson added that commodity traders are key users of maritime services; the new regime offers Hong Kong a distinct advantage in attracting them to set up or expand businesses, unlocking growth opportunities for the city's vision of becoming a global maritime capital.
Historical Performance and Minimum Top-up-Tax
Since 2020, the Government has actively promoted tax concessions to encourage shipping-related companies to establish or expand in Hong Kong, yielding tangible results, with qualifying ship lessors increasing fivefold between the years of assessment 2020/21 and 2023/24. Amidst new changes in the international tax landscape and OECD BEPS 2.0 formulation, Hong Kong introduced the Hong Kong Minimum Top-up-Tax under the Inland Revenue Ordinance to require in-scope multinational enterprise groups to pay a top-up tax from 2025 if their constituent entities' effective tax rate in Hong Kong is less than 15 per cent.
Legislative Timeline and Press Release
The Bill will be introduced into the Legislative Council for first reading on June 24. The press release ended on Wednesday, June 10, 2026, issued at HKT 18:40.
View the full article:Source
