Hong Kong's tax cuts are beneficial to business

In response to a question in the Legislative Council, Hong Kong Secretary for Financial Services and the Treasury, Professor Chan CS confirmed that the estate tax repeal in 2006, and the wine tax in 2008 benefited property management and wine business, respectively.

First, Chan noted that it is difficult to give an accurate assessment of additional investment, exclusively resulted from the abolition of inheritance tax, finance industry generally agrees that it has had a positive impact on the business of property management and financial sector as a whole.

"Our business is asset management and investment environment have become more attractive and competitive after the abolition of the tax. Together with the abolition of inheritance tax and the support of public policy, in conjunction with the ongoing promising economic prospects and improving the business environment, Hong Kong is becoming increasingly attractive for local, mainland and foreign investors, "he said.

He noted that in the year when the inheritance tax was repealed, the business of the combined administration of Hong Kong grew by 36% to HKD4.5 trillion (USD580 billion) in 2005 to HKD6.15 trillion in 2006. In subsequent years there was continued expansion in the business of asset management, both in size and in growth rates, with the exception of 2008, in connection with the global financial crisis. Number of employees manage the fund also increased from 16,100 in 2005 to 27,700 in 2009.

Secondly, he added that the abolition of the tax on wine was accompanied by the total volume of wine imports into Hong Kong, which rose from HKD3.2 billion in 2008-09 to HKD4.6 billion in 2009-10, and also that the increase in fortified wine business wine trade, auctions, and activities such as catering, tourism and educational activities.

Bureau of Commerce and Economic Development said that the addition of 850 wine-related companies in 2008 and 2009 increased the total number of wine companies in Hong Kong to 3550. Companies received HKD5.5 billion in proceeds related to the wine business in 2009, more than 30% more than in 2007. In 2008 and 2009 the number of people associated with the wine business has grown to over 5,000 by the end of the year, that number was already around 40000.




Agreement on avoidance of double taxation between the UK and Hong Kong entered into force

Double taxation avoidance agreement signed between the United Kingdom and Hong Kong on June 21 this year, entered into force on 20 December.

Agreement in the United Kingdom shall take effect from 1 April 2011 in respect of corporation tax and from 6 April of that year with respect to taxes on income and capital gains. In Hong Kong this Agreement shall enter into force on 1 April 2011.

The corresponding order puts into effect an agreement between the Governments of the United Kingdom and Hong Kong Special Administrative Region and the Republic of China on avoidance of double taxation and anti-tax evasion in connection with taxes on income and capital gains.

The aim of the agreements was the abolition of double taxation of income or capital gains arising in one country and paid to residents of another country. The agreement includes provisions for additional protection for taxpayers, through measures aimed at elimination of discrimination in the settlement of tax issues.

Among other things, the agreement provides for the protection scheme the role of the Treasury, realized by the inclusion in the text of the Agreement provisions aimed at combating tax avoidance and minimization of tax costs - in part by measures providing for the exchange of information between the fiscal authorities.






Estonia has adopted euro
Thousands of Estonians spent the last day of the year in the huge queues in banks and bureaux de change. From 1 January 2001 the country joined the euro zone.

Residents tried to exchange cash Estonian currency, including the small coins of the euro. They feared that after the introduction of new currency rate changes for the worse.

Prime Minister Andrus Ansip said the country's first withdrew euros from the ATM. He did it at the theater, where he spent New Year's ball. "It's one small step for the euro area and large - for Estonia", - said the head of government, clutching banknote single European currency.

Changeover to the euro due to the government's desire to improve the country's credit rating.
"Our Estonian kroons very beautiful, but unfortunately, investors do not trust them as they trust the euro", - said earlier Andrus Ansip.

Estonia is the first of the former Soviet republics adopt the European currency. According to experts' expectations, soon followed her, Latvia and Lithuania. However, the major countries of Eastern Europe until the introduction of the euro did not seek. Earlier, the leaders of Poland and the Czech Republic stated that the problem in the short term it is not necessary. According to the economists, Warsaw and Prague may have joined the euro no earlier than 2019-2020 years.