SFST's opening remarks on public finance at LegCo Finance Committee special meeting

On 14 Apr 2026, the Secretary for Financial Services and the Treasury, Mr Christopher Hui, delivered opening remarks at the Legislative Council (LegCo) Finance Committee special meeting to support Hong Kong's integration into the national development strategy and align with the National 15th Five-Year Plan.

Fiscal Consolidation and Revenue Management

The Treasury Branch is executing a reinforced fiscal consolidation programme to achieve fiscal balance within the economic cycle by strictly containing government expenditure growth, suitably increasing revenue, and expanding bond issuance. Legislative amendments have been introduced to raise the stamp duty rate for residential property transactions valued above $100 million from 4.25 per cent to 6.5 per cent, expected to generate approximately $1 billion in additional annual revenue.

Following the return of $61.5 billion from six seed capital funds last year, a full review of the remaining 36 funds established outside the Government's accounts was conducted. The review proposes bringing back about $15.8 billion from seven funds to the Government's accounts and consolidating six funds in 2026-27. A resolution will be introduced to the LegCo to enable the transfer of the Bond Fund's accumulated surplus of about $37 billion to the Consolidated Account.

Capital Works and Bond Issuance

Government capital works expenditure is estimated at approximately $128 billion for the current financial year, expected to remain at a similar level throughout the five-year Medium Range Forecast period. With approval from the Chief Executive in Council, $150 billion from the Exchange Fund's investment income will be transferred to the Capital Works Reserve Fund in two tranches to support the Northern Metropolis and other infrastructure projects, without compromising monetary system stability.

Financing plans involve issuing between $160 billion and $220 billion worth of bonds annually over the next five years, with the borrowing ceiling raised to $900 billion. The government debt to Gross Domestic Product ratio is projected to remain between 14.4 per cent and 19.9 per cent, considered highly prudent. The LegCo has finished scrutinising the proposed resolution, with support anticipated for issuing more longer-term bonds to align cash flow duration with project requirements.

Tax Policy and International Cooperation

To reinforce Hong Kong's position as an international financial and trade centre, the Government will introduce a 2026 amendment bill providing tax concessions at a half-rate or 5 per cent. An Advisory Committee on Tax Policy will be established to gather views from the commercial, industrial, and professional sectors, with its first meeting expected in the middle of the year.

Hong Kong has concluded 57 Comprehensive Avoidance of Double Taxation Agreements ("CDTAs"), with plans to expand the network to attract enterprises and support overseas expansion. Furthermore, a bill is planned for introduction in the middle of the year to implement the Crypto-Asset Reporting Framework and the amended Common Reporting Standard over the coming two years, enhancing tax transparency and combating cross-border tax evasion.

Legislative proposals have been introduced to alleviate the tax burden on salary earners by increasing tax allowances, raising the deduction ceiling, and implementing one-off tax reduction and rates concession as announced in the Budget. Mr Hui and his colleagues indicated their readiness to answer any questions from Members.

The release was issued at HKT 18:10 on Tuesday, April 14, 2026.