Hong Kong SAR

New legislation enacted

The following pieces of legislation were enacted in the past 12 months:

• The Inland Revenue (Amendment) (Tax Concessions for Intellectual Property Income) Ordinance 2024 was passed on 26 June 2024 to establish a patent box regime in Hong Kong.
• The Inland Revenue (Amendment) (Tax Concessions and Two-tiered Standard Rates) Ordinance 2024 was gazetted on 31 May 2024 to give effect to the 100% reduction of profits tax for the year of assessment 2023/24, subject to a cap of HKD 3,000.
• The Stamp Duty (Amendment) Ordinance 2024 (Ordinance) was gazetted on 19 April 2024 to give effect to the demand-side management measures for residential properties, which include (i) replacing the existing flat rate of ad valorem stamp duty payable on certain instruments dealing with residential properties with new rates that are same as those for non-residential properties and (ii) lowering the rate of special stamp duty payable on certain instruments dealing with residential properties, and the rate of buyer’s stamp duty payable on certain instruments to 0%.
• The Inland Revenue (Amendment) (Aircraft Leasing Tax Concessions) Ordinance 2024 was gazetted on 1 March 2024 to enhance the existing aircraft leasing preferential tax regime and make related amendments, which would take retrospective effect from the year of assessment 2023/24.
• The Stamp Duty (Amendment) (Residential Properties) Ordinance 2024 (Ordinance) was gazetted on 9 February 2024 to give effect to the demand-side management measures for residential properties, which include (i) shortening the applicable period of the special stamp duty from 36 months to 24 months and (ii) reducing the respective rates of the buyer’s stamp duty and new residential stamp duty from 15% to 7.5%.
• The Inland Revenue (Amendment) (Tax Deductions for Spectrum Utilization Fees) Ordinance 2024 was gazetted on 19 January 2024 to provide for tax deductions for spectrum utilisation fees (SUF) which would apply to SUF derived in auctions conducted on or after 19 January 2024.
• The Inland Revenue (Amendment) (Disposal Gain by Holder of Qualifying Equity Interests) Ordinance 2023 was gazetted on 15 December 2023 to introduce a tax certainty enhancement scheme for onshore equity disposal gains (Enhancement Scheme) with effect from 1 January 2024.
• The Inland Revenue (Amendment) (Taxation on Foreign-sourced Disposal Gains) Ordinance 2023 was gazetted on 8 December 2023 to refine the existing foreign-sourced income exemption (FSIE) regime by expanding the scope of assets in relation to foreign-sourced disposal gains to cover assets other than equity interests with effect from 1 January 2024.
• The Stamp Duty (Amendment) (Stock Transfers) Ordinance 2023 was gazetted on 16 November 2023 to give effect to the measure of reducing the rate of stamp duty on Hong Kong stock transfers to 0.1% from the prior rate of 0.13% of the transaction value payable by each of the buyer and the seller.
• The Insurance (Amendment) Ordinance 2023 was gazetted on 14 July 2023, which amends the Insurance Ordinance to provide a legal framework for the implementation of a risk-based capital regime for authorised insurers in Hong Kong SAR and make miscellaneous and related amendments to other ordinances, including the Inland Revenue Ordinance (IRO).