PASSAGE OF RATING BILL WELCOMED

The Government welcomed the passage of the Rating (Amendment) Bill 2024 by the Legislative Council today, which gives effect to the progressive rating system for domestic tenements.

The bill will take effect from the fourth quarter of this financial year, ie January to March 2025, to uphold the “affordable users pay” principle.

Starting from the fourth quarter, domestic tenements with a rateable value (RV) of $550,000 or below will continue to be charged rates at 5% of the RV. For domestic tenements with an RV exceeding $550,000, rates will be charged at the same rate of 5% for the first $550,000, 8% for the next $250,000, and 12% for the remaining RV.

Secretary for Financial Services & the Treasury Christopher Hui said the progressive rating system endeavours to strike a balance between upholding the “affordable users pay” principle and minimising the number of ratepayers affected.

Mr Hui noted in formulating the progressive rating system, the Government has taken into account a basket of factors, including the affordability of ratepayers of domestic tenements, the market rentals as reflected in the RV, the number of affected ratepayers and the amount of additional rates to be paid, the estimated increase in revenue from rates as well as the fundamental principle of maintaining a simple rating system.

He said the progressive rating system is part of the Government’s comprehensive fiscal consolidation programme. It is expected that government revenue will increase by about $820 million each year.

The affected domestic tenements account for about 1.9% of the total number of private domestic tenements in Hong Kong, Mr Hui added.

Non-domestic tenements, including those used for business activities or social services, will not be subject to the progressive rating system.

The bill will be gazetted on November 1.

The Rating & Valuation Department will inform the affected ratepayers, and the quarterly demands to be issued in the fourth quarter of this financial year will reflect the progressive rates for applicable cases.

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