LOWTAX.NET
CONTACT | ABOUT | LEGAL | LINKS     
   NETWORK SITES:
   LOWTAX   
   TAX-NEWS   

Jurisdiction Home Pages

Andorra
Anguilla
Aruba
Australia
Austria
Bahamas
Barbados
Belgium
Belize
Bermuda
Botswana
British Virgin Islands
Brunei
Canada
Cayman Islands
Cook Islands
Costa Rica
Cyprus
Denmark
Dubai
France
Germany
Gibraltar
Greece
Grenada
Guernsey
Hong Kong
Ireland
Isle of Man
Jersey
Labuan
Latvia
Liberia

Liechtenstein
Luxembourg
Madeira
Malaysia
Malta
Marshall Islands
Mauritius
Monaco
The Netherlands
The Netherlands Antilles
Nevis
New Zealand
Panama
Portugal
Russia
Seychelles
Singapore
South Africa
Spain
St. Kitts
St. Vincent and the Grenadines
Switzerland
Turks & Caicos Islands
USA
UK
Vanuatu

Newsletter

To receive monthly updates on new features in lowtax.net and tax-news.com just enter your e-mail address below:

Daily Tax Quote

The Network

3,000 free pages of accurate, timely information

Tax-News.com


Daily, updated news about tax and offshore from our team of 20 international journalists

Lowtax.net

'Low-tax' business and investment in the top 50 jurisdictions covered in exceptional detail

Investors offshore.com


Global information and advice for expatriates and international investors

Offshore-e-com.com

A topical guide to offshore e-commerce focused on tax and regulation

LawAndTax-News.com


Daily news and background data on tax and legal developments for international business

>
LOWTAX OFFSHORE

HONG KONG: EXECUTIVE SUMMARY


<

BACK TO HONG KONG INFORMATION: BUSINESS, TAXATION AND OFFSHORE

In this Section:

- HONG KONG THE COUNTRY AND ITS ECONOMY
- HONG KONG
- THE ECONOMY OF HONG KONG
- HONG KONG SERVICES DIRECTORY
- MAP OF HONG KONG


Hong Kong Executive Summary

Hong Kong Was A British Colony . . .

Hong Kong is a former British colony in South-East China, near Canton and Macau. With a surface area of 404 sq miles, Hong Kong is densely populated with 7m people. The capital city at Victoria, on Hong Kong Island, boasts one of the world's finest natural harbours. Hong Kong has one of the world's busiest international airports.

Mean January and July temperatures are 16° C and 28° C respectively. 90% of average rainfall of 85 inches falls between April and October. Typhoons occur between July and October.

Chinese and English are the official languages of Hong Kong. 99% of the people are ethnic Chinese. About 10% of the population are Christian with the balance being followers of Buddhism or Taoism. The major non-Chinese elements of the population are from the Philippines, British Commonwealth countries, the USA, Portugal and Japan.

. . . . But Is Now Again A Part Of China

Since 1st July 1997 Hong Kong has been a special administrative region (SAR) of the People's Republic of China. The constitution is known as the "Basic Law" and is modeled on the constitution of the People's Republic. Under the guiding principle of "one country, two systems" which was established before the handover the Chinese Government agreed that Hong Kong's capitalist system would remain unchanged until the year 2047.

The SAR's administration is headed by a Chief Executive, appointed by China. The Chief Executive appoints the Executive Council of Government. A legislative body, the Legislative Council passes laws and controls expenditure; its members are elected but the arrangements are undemocratic, so that the Executive can control a majority. This arrangement, established by the British, has not been changed since the handover.

The SAR maintains a common law system; the regulation and taxation of business and financial services follow Western patterns.

Hong Kong Is The Economic Gateway To China . . . . .

Hong Kong has thrived historically as a trading entrepot serving many Asia Pacific countries, and also as a low-cost manufacturing centre, although latterly the rise of cheaper Asian competitors has driven the SAR more into the provision of services, particularly financial services.

Hong Kong is the world's 3rd largest financial center (after New York and London), the 9th largest economy and the 11th largest exporter of services. GDP per capita exceeds that of Britain, Canada and Australia. The external assets of the banking sector are the world's 5th largest, forex turnover is the world's 6th largest and the Hong Kong stock market has the largest market capitalization in Asia outside of Japan. The territory has the largest representation of international banks in the world including 80 of the top 100 institutions and is the regional headquarters of over 3,000 multinational companies.

Since 1992 the territory has had the world's busiest container port with throughput increases of up to 20% per annum. Its shipping register is considered a quality register and ranks 14th in the world.

The Government has consistently followed business friendly policies and continues to do so. Other Asia-Pacific countries and cities such as Shanghai or Singapore may mount effective competition to Hong Kong as financial/trading hubs, but they will probably not be able to replicate Hong Kong's unique blend of Western expertise and Chinese knowledge. As China opens up to the world through its membership of the WTO, Hong Kong is both the natural conduit for Chinese exports towards the West, and the obvious base for international companies taking part in opening up China's expanding economy.

. . . . And Has A Highly Attractive Fiscal Environment

Hong Kong is not an 'offshore' jurisdiction as such, but has low tax rates which are levied only on Hong Kong-source income.

There is no capital gains tax, no withholding tax, no sales taxes, no VAT, no annual net worth taxes and no accumulated earnings taxes on companies which retain earnings rather than distribute them. Individuals pay no tax on investment income or capital gains, whether resident or not.

Hong Kong spectacular economic success is largely based on a whole hearted adherence to free and open trade, the values encompassed in a British common law legal system and a laissez-faire, non-interventionist attitude on the part of Government. As such there are few if any significant barriers to investment by foreigners.

However, Hong Kong's economy suffered considerably during and after the Asian crisis in the late 1990s. Continued deflation and low property prices were accompanied by higher unemployment and depressed levels of trade, leading to tax increases in the 2003/2004 budget.

Economic growth was muted in 2002 and 2003, but 2004 saw a major turnaround to 7.5% growth; in 2005, gross domestic product rose 7.3%.

In July, 2006, the Hong Kong government announced that a $14 billion surplus was recorded for the 2005-06 financial year, an improvement of $9.9 billion over the revised estimate of $4.1 billion announced in the 2006-07 Budget. Revenue for the year amounted to $247.1 billion, and spending to $233.1 billion. Revenue was $5.4 billion better than expected, largely as a result of higher collections in stamp duties, profits tax, salaries tax and land premiums towards the end of the financial year.

The forecast growth in GDP for 2007 is between 5%-6%.

 

<

BACK TO HONG KONG INFORMATION: BUSINESS, TAXATION AND OFFSHORE

 

THE LOWTAX LIBRARY

One of the web's largest and most authoritative business and investment information sources. Alongside topical, daily news on worldwide tax developments, you can receive weekly newswires or access up-to-date intelligence reports on a range of legal, tax and investment subjects.

FREE TRIAL NEWS SUBSCRIPTION

Our 16 constantly updated intelligence reports cover every important aspect of 'offshore' and international tax-planning in depth, including banking secrecy, the EU's savings tax directive, offshore funds, e-commerce, offshore gaming and transfer pricing. Reports are available for immediate downloading or as subscription services with news pages.

Advertising & Marketing

With over 50,000 qualified readers every month our web-sites offer a number of cost effective, targeted advertising, sponsorship and marketing opportunities:

Display advertising - from 'skyscrapers' to 'buttons'
Content/article submission and sponsorship
Opt-in email marketing
On-line Services Directory listings

Click here to learn more or contact Peter Wiggins on +44 1424 425933 or email him at peter@lowtax.net

News & Content Solutions

Could your corporate web-site or newsletter benefit from incorporating regularly updated news and content tailored to serve your clients' interests? We can provide a variety of maintenance-free news and content solutions that can be seamlessly integrated and dynamically delivered:

Customised, personalised 'own-brand' news services
Newsletter content and management
News Headlines Tickers

Click here to learn more or contact Peter Wiggins on +44 1424 425933 or email him at peter@lowtax.net

IMPORTANT NOTICE: THE LOWTAX NETWORK has taken reasonable care in sourcing and presenting the information contained on this site, but accepts no responsibility for any financial or other loss or damage that may result from its use. In particular, users of the site are advised to take appropriate professional advice before committing themselves to involvement in offshore jurisdictions, offshore trusts or offshore investments. All materials on this site copyright THE LOWTAX NETWORK 1999 to 2009. Contact us for further information.