Hong Kong is working to provide greater incentives for multinational corporations looking to establish corporate treasury centers in the territory, John C Tsang, Hong Kong's Financial Secretary, has said.
Speaking at a luncheon organized by the Hong Kong Association of Banks in late October, Tsang said that "as more and more multinational corporations and Mainland enterprises see the benefits of centralizing their treasury functions both onshore and offshore. Hong Kong is well placed to handle it for them." He said that the incentives "would include interest deduction as well as tax concessions."
He added: "For banks' compliance with Basel III's capital requirements, we are preparing legislative amendments that will clarify the tax treatment of regulatory capital securities. Capital instruments complying with Basel III requirements, that is to say, Additional Tier 1 and Tier 2 instruments, will be provided with debt-like treatment for profits-tax assessment under the Inland Revenue Ordinance."
"Accordingly, related transactions will be exempt from stamp duty. I hope this greater tax certainty will lessen your compliance burden."
By Courtesy of Lowtax.net
