Secretary for Financial Services & the Treasury Christopher Hui welcomed the passage of the Inland Revenue (Amendment) (Miscellaneous Provisions) Bill 2021 by the Legislative Council today. Mr Hui said: “The ordinance codifies the tax treatment with regard to qualifying amalgamations and the transfer or succession of specified assets, offering better clarity and certainty of the relevant matters.
“It would also provide the legal basis to enable more businesses to voluntarily file tax returns, including financial statements, electronically, with the ultimate goal of implementing electronic filing of profits tax returns through the Business Tax Portal.” Mr Hui noted the enhancement of the foreign tax deduction regime under the ordinance will reduce the tax liability of Hong Kong branches of foreign corporations, in particular foreign banks, and holders of intellectual property. It would help foster a more favourable business environment, particularly reinforcing Hong Kong’s attractiveness as a banking location and promoting the city as a research and development hub, he added. The ordinance will come into operation upon gazettal on June 11. Amendments in relation to foreign tax deduction will take effect from the year of assessment 2021/22.