Financial Secretary John Tsang spoke openly about politics during his budget speech on Wednesday morning, warning that political volatility could affect the economy.
Tsang’s ninth budget included a host of measures and subsidies to boost domestic consumption and assist local industries through the economic slowdown. He also announced that salaries tax, and tax under personal assessment for the 2015-16 year, is to be reduced by 75 per cent up to a ceiling of HK$20,000.
Tsang opened his speech by referring to the Mong Kong protest earlier this month as “a serious unlawful incident” and “a large-scale riot”.
“Distressed and angry, I was perplexed as to why violence had flared in Hong Kong”, he said. “I was shocked that our city could have turned overnight into such a strange and alien place that I hardly recognised. I was troubled why the core values that we long cherished had been devoured by violence and hatred.”
See more: LIVE: The 2016 Hong Kong Budget.
During the speech, he condemned a “handful of people” for choosing to “express their views and political demands using irrational and uncivilised tactics, such as hurling abuse at visitors and kicking their suitcases” – a reference to anti-parallel trader protesters. He said they have damaged the economy and severely tarnished Hong Kong’s reputation.
On the topic of “new markets”, Tsang briefly referred to the National 13th Five-Year Plan promulgated by the Central Authorities in November. However, unlike Chief Executive Leung Chun-ying, who mentioned the Belt and Road initiative over 40 times during his policy address in January, there were only four mentions of the term in Tsang’s budget speech.
The development strategy involves rejuvenating a land-based “silk road”, in tandem with a new “maritime silk road”, as part of an effort to increase China’s role on the world stage, increase its exports and connect countries across Eurasia.
Tsang also referred to the “unique advantages” that Hong Kong enjoys under the One Country, Two Systems principle: “We have not only a free and open market, but also efficient and transparent regulatory regimes well aligned with international standards.”
When putting forward estimates for capital expenditure for 2016-2017, Tsang said that the filibustering in the Legislative Council caused “a mounting backlog of funding proposals and delayed commencement of livelihood-related projects”.
In his concluding remarks, Tsang said that the atmosphere in Hong Kong has been “suffocating” and filled with “tiresome confrontations”, leaving the society polarised.
“Calm and rational discussions no longer have a place in this Council. There is not even room for dialogue in our society,” Tsang said.
Tsang warned that if the situation worsens, Hong Kong will be plunged into greater chaos and future generations will grow up amid hatred. He then called for a “return to rationality”, asking everyone to “set aside short-term political considerations in favour of the long-term overall interests of Hong Kong”. However, he also said he was positive that Hong Kong “can break the deadlock.”
Tsang ended the speech by referring to the World Cup qualifying match against Qatar last year. “We lost the match, but the never-say-die spirit that they exhibited won the hearts of our city… with our love for Hong Kong, we are able to overcome any challenge ahead of us, no matter how difficult it is.”
Lawmakers such as Frederick Fung Kin-kee said Tsang had taken into account the interest of Hong Kong people, rather than merely trying to please China as Leung Chun-ying had done with his annual address. The Business and Professionals Alliance for Hong Kong said that it was his best budget speech in nine years.
However, NGO the Society for Community Organisation (SoCO) said that the budget speech did not receive a passing grade and as it failed to address many grassroots problems.
Tsang has been tipped to run for the city’s top job in the Chief Executive election in 2017.
Other key measures announced:
- Rates waived for four quarters of 2016-17 subject to a ceiling of $1,000 per quarter for each rateable property.
- Profits tax reduced for 2015-16 by 75 per cent, subject to a ceiling of $20,000, to support small and medium enterprises.
- “Silver bonds” targeted at Hong Kong residents aged 65 or above to be launched.
- HK$20 million will be injected into the Film Development Fund to subsidise expenses incurred by locally-produced Cantonese films for distribution and publicity conducted in the mainland.
- Measures to boost tourism and start-ups.