Hong Kong SAR

New legislation enacted

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

• 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 Stamp Duty (Amendment) (Residential Properties) Bill 2023 was gazetted on 27 October 2023 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 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).
• The Inland Revenue (Amendment) (Tax Concessions for Family-owned Investment Holding Vehicles) Ordinance 2023 was gazetted on 19 May 2023, which introduces a 0% concessionary profits tax rate on assessable profits earned from qualifying transactions and incidental transactions (the latter being subject to a 5% threshold) for an eligible family-owned investment holding vehicle (FIHV) managed by an eligible single family office (ESF Office) in Hong Kong SAR. The tax concession applies retrospectively to any year of assessment commencing on or after 1 April 2022.