PLC Paper No. LS 8

Paper for the House Committee Meeting
of the Provisional Legislative Council
on 8 August 1997

Legal Service Division Report on
Inland Revenue (Amendment) (No. 3) Bill 1997
Dutiable Commodities (Amendment) (No. 2) Bill 1997

Object of the Bills

To amend the Inland Revenue Ordinance (Cap. 112) (IRO) and the Dutiable Commodities Ordinance (Cap. 109) (DCO) so that the Chief Executive will be subject to salaries tax and excise duty with effect from 1 July 1997.

PLC Brief Reference

2. FIN CR 2/2311/92 Pt.2 issued by the Finance Bureau in July 1997.

Date of First Reading

3. 23 July 1997.


4. Under section 8(2)(a) of the IRO, the official emoluments received by the Governor of Hong Kong are exempt from salaries tax.

5. The Executive Council, on the basis of the recommendations by the Independent Commission appointed to examine the remuneration package of the Chief Executive, has decided that the official emoluments received by the Chief Executive should be subject to salaries tax. The Bill proposes to repeal section 8(2)(a) with effect from 1 July 1997.

6. The DCO provides for, inter alia, the imposition of duty on liquors, tobacco, hydrocarbon oil, methyl alcohol and other substances. Under section 3(4) of the DCO, the DCO does not apply to goods which are the property of or imported or purchased for the Governor or for the Government of the United Kingdom or of Hong Kong. The Bill proposes to repeal the words or the Governor or�in the section with effect from 1 July 1997. The effect is that the Chief Executive will have to pay duty for dutiable goods he purchases. With regard to the reference to 懀he Government of United Kingdom� we are informed that this will be dealt with in a future adaptation of legislation exercise.

Public Consultation

7. No public consultation has been carried out.


8. The Bills involve only the taxation in relation to the Chief Executive. The legal and the drafting aspects of the Bills are in order. Members are recommended to support the Bills.

Prepared by

Ho Ying-chu, Anita
Assistant Legal Adviser
Provisional Legislative Council Secretariat
25 July 1997

Last Updated on 23 October 1997