Hong Kong Tries to Soothe the Rich With a Big Tax Break
Talk business and tax breaks now because it's something being discussed in Hong Kong by officials who are hoping these maybe a sweetness to help attract the best investors and joining us Is our business correspondent Andrea would and you tell us a bit more about these tax breaks and what exactly they're planning. Well, this being this, you know, Hong Kong has had a lot of political turmoil. Over the past two years, the Beijing has imposed the national security law on Hong Kong to try and quell that And its circuit, Bt's made Hong Kong perhaps a less attractive place to live a Zoricic olt. Hong Kong officials now seem to be talking about trying to encourage businesses. Especially in finance to stay in the city rather than go to its old rival Singapore or other cities in the region. Some of the key things we're waiting for more details, but one of the key things is helping private equity investors. There's a thing where the people of the the center of private Equity Investments, the general partners, These are people who actually run the fund. They could get paid Some of the way that they make their money is through a technique known as carried interest. Now this is always very controversial about whether it should be taxed or not. Anyway, Hong Kong seems to be prepared to give concessions so that private equity investors Don't have to pay this thing's tax. And then there's other incentives around as well to make it easier for companies that are based in Hong home to access it rich people on the mainland off China and try and near look after their wealth management needs. Do they really think that these businesses are going to be swayed or would by this is that he given the kind of level of of disquiet there's been even in business circles as to the political turmoil. Well. Traditionally, Hong Kong has bean quite in a political place. And cynics say that you're basically as long as you can make money. People are going to stay in Hong Kong. I mean, it started off as a free port, you know, back in Victorian times under the British, and it's always being very hasn't had much in the way of regulations is being very great. It should be in a great place for entrepreneurs. Make money. So I think this perhaps a rather cynical view here is that the big finance companies if you let them make more money by reducing their taxes, and so on, they are going to stay in her in Hong Kong. On that people are going to they may well have foreigners may well have political views, but they're not political activists. You know it's not their country, so the theory is that companies will stay here if they can make If they can make bigger profits.