Hong Kong budget 2024-25: government should cut property cooling measures gradually rather than all at once, tax expert and lawmaker say

Authorities urged to refrain from scrapping stamp duties in one go to avoid triggering real estate market volatility, in contrast to views from top political parties

Calls among those made to finance chief Paul Chan ahead of budget next week, as authorities grapple with ballooning deficit and concerns over investor confidence

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A pedestrian walks past property agency advertisements. One expert says the government’s move to reduce certain stamp duties last year has failed to make a big impact on the market. Photo: Edmond So

Published: 3:42pm, 24 Feb 2024Updated: 5:42pm, 24 Feb 2024

Hong Kong should scrap its property cooling measures gradually rather than all at once, a tax specialist and a lawmaker have said, arguing that any swift changes may destabilise the market.

Their concerns on Saturday went against views expressed by some of the city’s top political parties, which earlier called for all curbs to be lifted in one go and said the move would boost the sluggish market without causing home prices to soar.

Carol Liu Zhaohua, president of the Taxation Institute of Hong Kong, said authorities should remove property stamp duties in phases to better stabilise the market amid falling investor confidence.

“At present buyers’ confidence has weakened so it is better to gradually scrap the property cooling measures in phases to revive the market step by step,” she told a radio programme.

Political organisations, lawmakers, institutions and community groups are submitting their views to Financial Secretary Paul Chan Mo-po, who will deliver his budget address on Wednesday, in which he is widely expected to take aim at a ballooning deficit estimated to exceed HK$100 billion (US$12.8 billion).

Popular calls have included scrapping curbs such as a special stamp duty applied to a residential property resold within 24 months, a buyer’s stamp duty for non-permanent residents and a double stamp duty on flats for second-time purchasers. The stamp duty rates range between 10 and 20 per cent.

Election Committee lawmaker Wendy Hong says “the most important thing is to stabilise the market”. Photo: Facebook/Wendy Hong Wen

Liu said the government’s move to reduce certain stamp duties in October last year had failed to make a big impact on the real estate market.