In a rare departure from its usual practice, the Hong Kong government actually listened to the people for once, and announced that it is scrapping the proposed goods and services tax (GST).
Just about everyone opposed this tax: ordinary people because it was regressive and would transfer part of the tax burden from the rich to the poor; the business community because it would impose a heavy administrative overhead on every company in the SAR; retailers because it would hurt sales; the tourism industry because it would make Hong Kong more expensive to visitors, and therefore a less attractive destination.
Nevertheless, the problem that the tax was supposed to solve remains: the government's narrow tax base and over-dependence on revenue from property transactions. So here's a suggestion: listen to the people some more. Public concern about environmental issues in Hong Kong has never been stronger, particularly with regard to the filthy smog-laden air we have to breathe. So how about a pollution tax, or rather a targeted set of environmental taxes?
Tax retailers for giving out unnecessary free plastic bags that end up in landfills. Tax minibus operators that have not yet converted their vehicles to run on cleaner LPG. Tax the power companies for every unit of pollution they emit until they fit more efficient emission controls on their generating stations. Tax transport operators that don't fit new cleaner engines to their vehicles within a reasonable time. Tax excessive packaging. And so on...
You get the idea. Raise public revenue while hitting polluters in the pocket, until they find it cheaper to clean up their act than to continue dirtying the environment, thereby killing two birds with one stone. How about it, Mr Tang?
Making It Better:
- Clear The Air
- Friends of the Earth (Hong Kong)