2.44m ‘green bombs’ about to drop as revenue plummets to HK$342b

The Inland Revenue Department on Thursday sent out about 2.44 million tax returns for individuals – dubbed “green bombs” – for the 2023/24 year and reminded citizens to file their tax returns on time.

The filing deadline for general cases is June 3 while a three-month period is allowed for sole proprietors of unincorporated businesses, meaning their deadline will be August 2.

During a press conference on Thursday, Commissioner of Inland Revenue Tam Tai-pang said the provisional revenue collected by the department in 2023-24 stood at HK$342 billion, down 5 percent or HK$18.2 billion compared to the figure logged in 2022-23.

The main reason is that stamp duty revenue plummeted by 30 percent from about HK$70 billion to only HK$49 billion. Profits tax also declined by 2 percent by HK$3.7 billion to about HK$170 billion.

As for salaries tax, it reached a record high after a 0.5 percent increase, or up HK$380 million, to about HK$79.9 billion, Tam said.

Tam referred to the two tax measures proposed in the 2024-25 Budget. The first is the reduction of profits tax, salaries tax and tax under personal assessment for 2023-24 by 100 percent, subject to a ceiling of HK$3,000 per case.

The second is the implementation of a two-tiered standard rates regime for salaries tax and tax under personal assessment starting from 2024-25.

Last year’s policy address also announced that starting from 2024/25, the deduction ceiling for home loan interest or domestic rents will be raised to HK$120,000 for eligible taxpayers of salaries tax and tax under personal assessment who are residing with children born on or after October 25, 2023.

Tam continued that the bill for implementing the above three tax measures is being scrutinized by the Legislative Council and taxpayers only need to complete the tax returns for 2023/24 as usual. The proposed tax reduction will be reflected in the assessments after relevant legislation is passed.

The department encouraged taxpayers to file their tax returns through eTAX, which offers an easy, secure and environmentally friendly online service for filing tax returns and ensures tax returns are filed in a timely manner to the department.

“iAM Smart+” users may also sign and submit electronic tax returns online with the digital signing function. Taxpayers are reminded to pay sufficient postage if they choose to send the returns by post.