PRESS RELEASE

DGIP's response to media enquiries on GST

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In response to media enquiries today (September 26) on the possible impact on Hong Kong's competitiveness in attracting investments with the possible introduction of a goods and services tax, the Director-General of Investment Promotion, Mr Mike Rowse, gave the following comments:

"As regards the consultation on the possibility of introducing a goods and services tax, it is worth pointing out that the cities and economies with whom we are most usually seen to be in competition all have a goods and services tax already. For example, at the regional headquarters, regional office level, we would be normally compared with Singapore, and sometimes to some extent with Sydney. And both cities have a GST already. For offices covering China, we compete with perhaps Beijing and Shanghai and of course, the Mainland already has a tax on goods. I think this has to be seen in that sort of perspective."

"Given Hong Kong's many advantages favoured by foreign investors and our Government's commitment to continuously improve the business environment here, we think Hong Kong's overall competitiveness will remain strong."

Ends/Tuesday, September 26, 2006
Issued at HKT 20:16

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