PRESS RELEASE

Inland Revenue (Amendment) (Tax Concessions for Certain Shipping-Related Activities) Bill 2022 gazetted

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     The Government published the Inland Revenue (Amendment) (Tax Concessions for Certain Shipping-Related Activities) Bill 2022 in the Gazette today (June 2).
  
      The Bill seeks to amend the Inland Revenue Ordinance (IRO) (Cap. 112) to give half-rate profits tax concessions (i.e. at a tax rate of 8.25 per cent) to qualifying shipping commercial principals (i.e. ship agents, ship managers and ship brokers). The profits derived by a qualifying shipping commercial principal from carrying out a qualifying activity for an associated shipping enterprise, which is entitled to a concessionary tax rate or income exemption under the IRO, will also be subject to the same concessionary tax rate or income exemption as those applicable to the associated shipping enterprise. Anti-abuse provisions are included in the Bill to safeguard the integrity of the tax system and comply with international tax rules.

      "Ship agency, ship management and ship broking businesses are important maritime business services supporting international shipping activities. The legislative amendments would provide tax incentives for qualifying ship agents, ship managers and ship brokers to operate in Hong Kong. As these businesses serve to facilitate ship ownership and operation, which also generate demand for other maritime business services, fostering the development of shipping commercial principals in Hong Kong is conducive to the growth of our shipping business and maritime cluster," a spokesman for the Transport and Housing Bureau said.
  
      Recognising the business opportunities arising from the growth of shipping commercial principals, the competitive landscape for maritime business in the region and Hong Kong's strong fundamentals as an international maritime centre, the Government announced in the 2021 Policy Address its plan to introduce tax concessions for shipping commercial principals. The Bill will introduce tax measures to strengthen Hong Kong's competitiveness in attracting ship agency, ship management and ship broking activities which will also help attract the setting up of related maritime business establishments in Hong Kong, thereby consolidating the city's position as an international maritime centre.

      The Bill will be introduced into the Legislative Council for first and second readings on June 15. 
 

Ends/Thursday, June 2, 2022 
Issued at HKT 11:00

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