Rafael Hui admits in corruption trial that he evaded taxes on 'fees'
Former chief secretary says he didn't report the money Kwoks paid him allegedly for information
Rafael Hui Si-yan admitted in court yesterday that he had evaded taxes on income totalling HK$21.8 million, earned from Thomas Kwok Ping-kwong of Sun Hung Kai Properties, in the years before and during his term as chief secretary.
Of that sum, Hui received HK$18.8 million between 2004 and 2005 as remuneration for consulting work he did for SHKP starting in the summer of 2003.
"I wanted to save some tax payments," Hui testified during the High Court graft trial for him and Kwok.
The court also heard how he helped Donald Tsang Yam-kuen canvass for support among sceptical electors before the 2005 chief executive poll, although he said Beijing had predetermined Tsang's ultimate victory.
Hui is accused of accepting bribes from brothers Thomas Kwok and Raymond Kwok Ping-luen, both now SHKP co-chairmen, to be their "eyes and ears" in government.
He claims the HK$21.8 million was to pay for consulting services rendered to SHKP.
The first payment, of HK$3 million, was made in 2003 by Thomas Kwok personally. Hui covered up that sum because, he said, he was not sure what to tell the tax collector as Kwok had only agreed verbally to the remuneration amount.
"My intention at that time was to … declare the payment" later, he told the nine jurors.
But Hui's reasons for subsequent omissions changed.
During the following tax assessment year, 2004-2005, Hui took another HK$3 million from Kwok without telling the Inland Revenue Department - shortly before he was appointed as Tsang's top aide in June 2005.
He did so with the intention to pay less in taxes, he said.
"You would be occupying the second-highest ranking office within the government," said his lawyer, Edwin Choy Wai-bond. "And, despite this, you decided to conceal your real income from the government?"
Hui answered: "Correct."
In the next set of tax returns, Hui, by then chief secretary, omitted another sum from Kwok, of HK$15.8 million.
Choy said: "Whilst serving as chief secretary, you decided to conceal these incomes from the government?" Hu replied: "Yes."
Prosecutors allege that when the Kwoks funnelled HK$10.8 million to Hui, about HK$2 million was retained by a go-between, Francis Kwan Hung-sang, as a reward.
But Hui yesterday said Kwan, his friend and co-defendant, withheld the sum so Hui could ask him to buy foreign currencies on his behalf when necessary.
On his appointment as the government's No 2 man, Hui said he learned from Tsang a month ahead of Beijing's announcement in late June 2005 he would get the job.
Hui, 66, faces eight charges related to bribery and misconduct in public office. Thomas Kwok, 62, faces one charge of conspiracy to offer an advantage to Hui and two counts of conspiracy to commit misconduct in public office. Raymond Kwok, 61, faces four charges, including one with Hui of furnishing false information. SHKP executive director Thomas Chan Kui-yuen, 67, and Kwan, an ex-Hong Kong stock exchange official, 63, each face two charges. All have pleaded not guilty. The trial continues.
