Hong Kong Treasury Department: Hong Kong plans to issue bonds for financing of 160 to 220 billion Hong Kong dollars annually in the next five years.

The Secretary for the Treasury of Hong Kong, Mr. Christopher Hui, stated at a special meeting of the Legislative Council Finance Committee today (April 14) that Hong Kong will issue approximately HK$160 billion to HK$220 billion in bonds annually over the next five years, increasing the government's debt limit to HK$900 billion. The ratio of government debt to Gross Domestic Product (GDP) will be maintained at 14.4% to 19.9%, which is still much lower than most advanced economies and considered a very stable level. The government will issue more long-term bonds in the future to better align cash flow maturity with the funding needs of projects. The Legislative Council has completed its deliberations on this matter and hopes that members will support the resolution. Mr. Hui stated that in order to better support Hong Kong's integration into and service of the overall national development, aligning with the national "14th Five-Year Plan", the Treasury of Hong Kong will continue to strengthen public financial management, develop tax policies that are conducive to business, optimize resource allocation, and make good use of public financial management tools to ensure that financial resources effectively promote high-quality economic development in Hong Kong. The key focus areas of the Treasury of Hong Kong for this year include: 1. Continuously implementing the enhanced financial integration plan proposed in last year's Budget, strictly controlling government expenditure growth, moderately increasing revenue, consolidating government financial resources, increasing the size of debt issuances, and maintaining government fiscal balance throughout the economic cycle. 2. Abiding by the principle of "increasing revenue as a supplement" and "taxing the capable more", the Treasury of Hong Kong has submitted a draft amendment to raise the stamp duty on residential property transactions worth over HK$100 million from 4.25% to 6.5%, moderately increasing revenue with an expected additional annual revenue of approximately HK$1 billion. 3. Following the transfer of HK$61.5 billion from six seed funds to the government's accounts last year, the Treasury of Hong Kong has conducted a comprehensive review of the remaining 36 funds held outside the government's accounts, recommending the transfer of approximately HK$15.8 billion from seven funds and the integration of six funds in the fiscal year 2026-2027. The results of the review were reported to the Panel on Financial Affairs last Friday. Additionally, a resolution will be submitted to the Legislative Council to transfer the accumulated surplus of around HK$37 billion from the bond funds to the government's consolidated accounts within the year. 4. The budget for essential infrastructure spending this year is approximately HK$128 billion, which will be maintained at a similar level over the next five years in the mid-term fiscal forecast. To support projects in the Northern Metropolis area and other infrastructure projects, the government will transfer HK$150 billion from last year's investment income of the Exchange Fund to the Infrastructure Reserve Fund, to be carried out in two phases in this fiscal year and the next fiscal year. This arrangement has been approved by the Chief Executive in Council. The Treasury of Hong Kong will also implement the following measures to support citizens and businesses, and to consolidate Hong Kong's status as an international financial and trade center: 1. To promote industrial development and attract investment, the government will submit a draft amendment within the year to provide a tax concession of half-rate or a rate of five percent. 2. The government will assist the Financial Secretary in setting up a "Tax Policy Consultative Committee" to seek the opinions of business professionals in formulating tax policies that better support economic development. The first meeting is expected to be held in the middle of the year. 3. Hong Kong has signed 57 comprehensive double taxation avoidance agreements to date. The government will continue to expand the network of agreements to attract companies to Hong Kong and promote the expansion of Hong Kong companies into overseas markets. 4. In terms of international taxation, the government plans to submit draft legislation in the middle of the year to implement in the next two years a framework for reporting encrypted assets and revised common reporting standards to enhance tax transparency and combat cross-border tax evasion. 5. To reduce the tax burden on employees and in line with the government's policy to encourage childbirth, the government has submitted legislative proposals to the Legislative Council for increasing tax allowances and deduction ceilings, one-off tax relief, and one-off rates reduction as proposed in the Budget.