Consulting firm EY on Thursday called on the government to roll out more tax concessions, although it expected the budget deficit would double. The firm estimated that Hong Kong’s budget deficit would be HK$98 billion, while accountancy firm PriceWaterhouseCoopers (PwC) forecast the gap at HK$95 billion. Last month, government officials said the deficit would be near HK$100 billion, more than double the original estimate of HK$48 billion. EY noted that governemnt revenue from land premiums and stamp duty fell short of expectations, despite the easing of property cooling measures last year. However, the consultancy's financial services tax leader for Hong Kong, Paul Ho, said authorities should cut tax for real estate investors and commodity traders to boost the economy. "Providing those concessions will actually attract more businesses and investors and capital to Hong Kong," he said. "Tax concessions or some kind of tax measures that could benefit and attract investors will actually overall help the growth of the Hong Kong economy." PwC also called for similar moves, suggesting the government reduce tax for research and development activities in the Greater Bay Area.
