治稅以法 服務以誠
Tax by the Law
Service from the Heart
Annual Report 2017-18年報
Vision, Mission and Values
VISION
We aim to be an excellent tax administration that plays an important part in promoting Hong Kong’s prosperity and stability.
MISSION
We are committed to –
■ collecting revenue efficiently and cost-effectively;
■ providing courteous and effective service to the taxpaying public;
■ promoting compliance through rigorous enforcement of law, education and publicity programmes; and
■ enabling staff to acquire the necessary knowledge, skills and attitude so that they can contribute their best to the achievement of our vision.
VALUES
Our core values are –
■ Professionalism
■ Efficiency
■ Responsiveness
■ Fairness
■ Effectiveness
Contents
Chapter 1 Commissioner’s Foreword Chapter 2 Revenue
Chapter 3 Assessing Functions Profits Tax
Salaries Tax Property Tax
Personal Assessment Tax Treaty Network Advance Rulings
Advance Pricing Arrangement Objections
Appeals to the Board of Review Appeals to the Courts
Business Registration Stamp Duty
Estate Duty Betting Duty
Tax Reserve Certificates Chapter 4 Collection
Collection of Tax Refund of Tax
Recovery of Tax in Default Chapter 5 Field Audit and Investigation
Field Audit Investigation
Property Tax Compliance Check Chapter 6 Taxpayer Services
IRD Website
Electronic Enquiry Service Enquiry Service Centre
Tax-help Services for Completion of Tax Returns
Complaints and Compliments Performance Pledge
Chapter 7 Information Technology IT Environment
Electronic Services Chapter 8 Human Resources
Organisation Chart Establishment
Staff Promotions and Turnover Training and Development Staff Relations and Welfare The IRD Sports Association Chapter 9 Legislative Amendments Chapter 10 Environmental Report
Green Management Policy Green Management and
Promotion of Green Awareness
Environmental Protection Performance in 2017-18 New Initiatives and Targets Chapter 11 Miscellaneous
Charitable Institutions General Inspection Internal Audit
Approval for Tax Return Forms and the Manner of Furnishing Tax Returns
Schedules
1 Commissioner’s Foreword
The total revenue collection of the Inland Revenue Department in 2017-
18 was $328.6 billion, which is a record high. It was $38.4 billion higher than the collection of last year, representing a rise of 13.2%. Among the different tax types, Stamp Duty and Salaries Tax reached a record high this year. Stamp Duty and Salaries Tax recorded an increase of 54%
and 3% respectively whilst Profits Tax
decreased slightly by 0.1%.
In 2017-18, the Department encountered new developments in different areas of work. Below are the legislative changes in relation to Stamp Duty, Profits Tax and exchange of information.
Facing the recurrence of the overheated residential property market, the Government introduced on 5 November 2016 a new measure to raise the ad valorem stamp duty rate of residential property transactions across-the-board to a flat rate at 15% to prevent the bubble risk of the property market from deteriorating further. The Stamp Duty (Amendment) Bill 2017, which seeks to implement the new residential stamp duty (NRSD) measure, was passed by the Legislative Council (LegCo) in January 2018 to become the Stamp Duty (Amendment) Ordinance 2018. During the scrutiny of the above amendment bill, the majority of LegCo Members and members of the public expressed grave concern over the increasing trend where some Hong Kong permanent residents (HKPRs) acquired multiple residential properties under a single instrument to avoid payment of the new rate of stamp duty, thereby undermining the intended effect of the measure. In view of this, the Government announced on 11 April 2017 that it would introduce legislative amendments to tighten up the exemption arrangement for HKPRs under the NRSD regime. If a HKPR acquires more than one residential property under a single instrument, the transaction will no longer be exempted and will be subject to the NRSD rate of 15%. The tightened up exemption arrangement took effect on 12 April 2017. The Stamp Duty (Amendment) (No. 2) Bill 2017, which seeks to implement the tightened exemption arrangement, was passed by the LegCo in April 2018 to become the Stamp Duty (Amendment) (No. 2) Ordinance 2018.
To implement the two-tiered profits tax rates regime announced by the Chief Executive in the 2017 Policy Address, the Inland Revenue (Amendment) (No. 3) Ordinance 2018, which was gazetted on 29 March 2018, amended the Inland Revenue Ordinance (IRO). With effect from the year of assessment 2018-19, the profits tax rate for the first $2 million of assessable profits of corporations is lowered to 8.25%. Profits above that amount continue to be subject to the tax rate of 16.5%. For non-corporate persons, the two-tiered tax rates are correspondingly set at 7.5% and 15%.
For the purpose of enabling Hong Kong to implement more effectively the automatic exchange of financial account information in tax matters (AEOI) promulgated by the Organisation for Economic Cooperation and Development (OECD), the Inland Revenue (Amendment) (No. 2) Ordinance 2017 was gazetted on 16 June 2017 to increase, with effect from 1 July 2017, the number of “reportable jurisdictions” to 75 under the IRO.
The Department has established the AEOI Portal for financial institutions to notify and file financial account information returns electronically. Notices requiring financial institutions to file financial account information returns for the year 2017 have been issued since January 2018.
On the other hand, given the continued expansion in the scope and network of tax information exchanges in the international community, Hong Kong needs to move from the established bilateral approach to the multilateral approach to implement the relevant initiatives. The Inland Revenue (Amendment) Ordinance 2018 (2018 Amendment Ordinance) was gazetted on 2 February 2018 to provide the legal framework for Hong Kong to implement multilateral tax arrangements, thereby allowing more effective implementation of AEOI and automatic exchange of country-by-country (CbC) reports and spontaneous exchange of information on tax rulings under the base erosion and profit shifting (BEPS) package.
After the passage of the 2018 Amendment Ordinance, the Central People’s Government deposited the declaration for extending the application of the Convention on Mutual Administrative Assistance in Tax Matters (the Convention) to Hong Kong with the OECD in May 2018. The Convention provides a multi-party platform for participating jurisdictions to mutually agree with each other on various forms of administrative cooperation in the assessment and collection of taxes, including exchange of information. The scope of information to be exchanged under the Convention, as compared with the bilateral approach, is generally the same. In July 2018, the Chief Executive in Council made an order to declare that the Convention shall have effect in Hong Kong. The order will be tabled at the LegCo for negative vetting in October 2018.
The year 2017-18 was full of challenges. As a result of the new initiatives introduced by the Government and the rapid development of international tax standards, legislative amendments were required for various issues. The Department’s workload has been increasing. I am thankful for colleagues’ continuous dedication to surmount difficulties and accomplish our missions in a professional manner.
WONG Kuen-fai
Commissioner of Inland Revenue
2 Revenue
In 2017-18, the Inland Revenue Department collected $328.6 billion which represents an increase of
$38.4 billion or 13.2% as compared with the previous year. The increase mainly came from stamp duty.
Stamp duty collections increased by 54% to $95.2 billion. Salaries tax collections increased by 3% to $60.8 billion. Profits tax collections, on the other hand, slightly decreased by 0.1% to $139.1 billion. An analysis of the revenue collected by tax type is provided in Figure 1.
Figure 1 Revenue collected by tax type
Type of tax 2014-15
($m)
2015-16 ($m)
2016-17 ($m)
2017-18 ($m) Profits tax -
Corporations 132,683.8 135,574.0 134,031.3 133,459.3
Unincorporated businesses 5,163.1 4,652.6 5,206.8 5,640.9
Salaries tax 59,346.8 57,867.8 59,077.5 60,838.8
Property tax 2,938.6 2,998.0 3,371.7 3,447.8
Personal assessment 4,817.2 4,790.0 5,220.0 5,342.5
Total earnings & profits tax 204,949.5 205,882.4 206,907.3 208,729.3
Estate duty 178.2 30.0 18.8 31.3
Stamp duty 74,844.9 62,680.3 61,899.0 95,172.8
Betting duty 19,479.3 20,127.2 21,119.0 21,959.1
Business registration fees 2,480.6 2,607.1 227.7 2,726.7
Total revenue collected 301,932.5 291,327.0 290,171.8 328,619.2
% change over previous year 24.0% -3.5% -0.4% 13.2%
The revenue collected by the Department during 2017-18 accounted for 74% of the Government General Revenue (Figure 2). Profits tax and salaries tax contributed 60.8% of the total revenue collected while stamp duty made up a further 29% (Figure 3).
Figure 2 Government General Revenue
500
400
300
(75.9%) (75.9%) (66.5%) (74%) 200
100
0 2014-15 398
The Department's collections Other General Revenue
2015-16 384
436 444
2016-17 2017-18 ($b)
Figure 3 Composition of the revenue collections
Betting (6.7%)Duty
Others (3.5%)
Profits Tax (42.3%) Stamp
(29%)Duty
Salaries Tax (18.5%)
2017-18
In 2017-18, the cost of collection decreased from 0.55% to 0.48% (Figure 4).
Figure 4 Cost of collection
1.0
0.5
0 2014-15
0.48
2015-16
0.49 0.52 0.55
2016-17 2017-18 (%)
3 Assessing Functions
The Department raises revenue through taxes, duties and fees in accordance with the relevant legislation.
Earnings and profits tax are assessed by reference to the incomes / profits of the taxpayers in the previous year, whereas duties and fees are charged at the time the relevant activities occur. For 2017-18, earnings and profits tax assessed increased by $8.3 billion (4%) (Schedule 2) as compared with the previous year. The total amount of duties and fees collected increased by $36.6 billion (44%).
Profits Tax
Profits tax is levied on individuals, corporations, bodies of persons and partnerships, in respect of assessable profits arising in or derived from Hong Kong. The tax rates for corporations and non-corporate persons are 16.5% and 15% respectively.
The amount of profits tax assessed in 2017-18 was $144.9 billion, which was $6.7 billion (4.8%) more than that of the previous year, reflecting a modest growth in the Hong Kong economy (Figure 5).
The amounts of final tax assessed in respect of different business sectors are shown in Schedules 3 and 4.
Of the total final tax assessed for the year of assessment 2016-17, the property, financial and banking sectors together contributed 45.5% and the distribution sector generated 22.6% (Figure 6).
Figure 5 Profits tax assessed
160 140 120
127.3 4.9
132.5 5.7
134 5
138.7 6.2
100 80 60 40 20 0 ($b)
2014-15
Corporations Unincorporated Businesses
2015-16 2016-17 2017-18
Figure 6 Ratios of corporation profits tax assessed under 2016-17 final assessments by business sectors
Manufacturing (4.5%) Distribution
(22.6%)
Banking (21%)
Public Utilities (5.7%)
Property, Investment &
Finance (24.5%) Others (21.7%)
Salaries Tax
Salaries tax is charged on all incomes from any office (e.g. a directorship) or employment and pension arising in or derived from Hong Kong. The total amount of tax payable is restricted to the standard rate (15%) on the net total income (without deduction of allowances) of the individual concerned.
As compared with the previous year, the number of salaries tax assessments made during 2017-18 decreased by 2.5%. However, the continued growth in wages and earnings has resulted in a 2.6% increase in the amount of tax assessed (Figure 7).
Figure 7 Salaries tax assessments
2,900
2,800 3,000
2,700
2,600
2,750
2,797
2,939 Number
2,866 ('000)
2014-15 2015-16 2016-17 2017-18
70 60 50 40 30 20 10 0
62 60.6 61.3 62.9
($b) Tax assessed
2014-15 2015-16 2016-17 2017-18
Analyses of salaries tax assessments and allowances granted in respect of taxpayers at various income levels for the year of assessment 2016-17 are provided in Schedules 5 and 6.
For the year of assessment 2016-17, the number of standard rate taxpayers decreased by 2,380 to 27,446.
These taxpayers together contributed 35.8% of the salaries tax assessed, a decrease of 2.2% compared with last year (Figure 8).
Figure 8 Standard rate taxpayers
Percentage of total number of taxpayers
2015-16 2016-17
Total number of taxpayers 1,851,742 1,764,543
Standard rate taxpayers 29,826 27,446
Percentage of total salaries tax assessed
2015-16 2016-17
Total salaries tax assessed ($M) 58,822 58,774
Tax contributed by standard rate taxpayers ($M) 22,344 21,042
Percentage 38% 35.8%
Notification Requirements of Employers
Employers are required to notify the Department of commencements and cessations of employment as well as employees’ impending departure from Hong Kong for more than 1 month. Besides, employers are required to prepare annual employer’s returns to report the emoluments of each of their employees. During the year, 386,596 employers filed employer’s returns with the Department.
The Department provides e-Seminars and disseminates tax information to employers on the IRD website to help them understand the relevant statutory requirements. The contents cover completion of employer’s returns, employer’s obligations and answers to frequently asked questions. Employers can also obtain specimens of completed employer’s returns and notification through the Fax-A-Form service.
Property Tax
Property owners (including corporations) are subject to property tax which is charged at the standard rate (15%) in respect of the net assessable value of the property. Rents received from properties solely owned by individuals should be declared in Tax Returns-Individuals (BIR60); whilst rents received from properties jointly owned or co-owned by individuals or properties held by corporations / bodies of persons should be declared in Property Tax Returns (BIR57 / BIR58). Property owners that pay property tax in respect of premises used for their businesses can have such payments set off against their profits tax liabilities. For corporations, income arising from properties owned by them is also subject to profits tax at the corporation rate. To obviate the need for yearly set-off of property tax against profits tax, a corporation can apply for exemption of property tax on the property concerned.
Statistics on the classification of properties and classification by number of owners, based on the records of the Department, are provided in Schedule 7. The number of assessments made in 2017-18 was more than that in the previous year by 0.6%. The amount of property tax assessed decreased by 0.3% (Figure 9).
Figure 9 Property tax assessments
650
600
550
573
599
625 Number
629 ('000)
2014-15 2015-16 2016-17 2017-18
4
3
2
1
0
3.23 3.33
3.69 3.68
($b) Tax assessed
2014-15 2015-16 2016-17 2017-18
Personal Assessment
If an individual has income chargeable to profits tax and/or property tax, he/she may elect for personal assessment. Under personal assessment, all the incomes of the taxpayer and his or her spouse (if married) are aggregated and, after deduction of allowances, are assessed at the progressive tax rates applicable to salaries tax. In appropriate circumstances, this would reduce the total tax liability of the taxpayer and his or her spouse.
As compared with the previous year, the number of personal assessments made in 2017-18 decreased by 2.9%
but the amount of tax assessed was 1.5% higher (Figure 10).
Figure 10 Assessments made under personal assessment
400
350
360 362
384 Number
373 ('000)
5 6
4 3 2 1
4.87 4.85 5.28 5.36
($b) Tax assessed
Tax Treaty Network
Double taxation arises where the same item of income or profit of a taxpayer is subject to tax in Hong Kong as well as in another tax jurisdiction. To establish a tax treaty network can help minimise exposure of Hong Kong residents and residents of the tax treaty partners to double taxation. It will also facilitate the flows of trade, investment and talent between Hong Kong and the rest of the world, and enhance Hong Kong’s competitiveness as an international financial, investment and commercial hub.
As at 31 March 2018, Hong Kong has signed comprehensive double taxation agreements (covering various types of income) with 39 jurisdictions. They are Austria, Belarus, Belgium, Brunei, Canada, the Czech Republic, France, Guernsey, Hungary, India, Indonesia, Ireland, Italy, Japan, Jersey, Korea, Kuwait, Latvia, Liechtenstein, Luxembourg, the Mainland of China, Malaysia, Malta, Mexico, the Netherlands, New Zealand, Pakistan, Portugal, Qatar, Romania, Russia, Saudi Arabia, South Africa, Spain, Switzerland, Thailand, the United Arab Emirates, the United Kingdom and Vietnam.
Hong Kong, as a responsible member of the international community, is committed to enhancing tax transparency and preventing tax evasion. To comply with the latest international standard on exchange of information, Hong Kong has entered into tax information exchange agreements with appropriate partners since 2014. As at 31 March 2018, Hong Kong has signed tax information exchange agreements with 7 jurisdictions. They are Denmark, the Faroes, Greenland, Iceland, Norway, Sweden and the United States of America.
Advance Rulings
Taxpayers may apply for an advance ruling on how a provision of the Inland Revenue Ordinance applies in relation to a particular arrangement. A fee is charged for the service on a “cost recovery” basis. The applicant is required to pay an initial application fee of $30,000 for a ruling concerning the application of the “Territorial Source Principle” in a profits tax case, or $10,000 for a ruling on any other matter. An additional fee is payable if the processing time exceeds the specified limit. The Department endeavours to respond within 6 weeks of the date of application, provided that all relevant information is supplied with the application and further information from the applicant is not required.
During 2017-18, the Department completed the processing of 40 advance ruling applications (Figure 11).
Most of the applications were for rulings on profits tax matters.
Figure 11 Advance rulings
2016-17 Number
2017-18 Number
Awaiting decision at the beginning of the year 26 18
Add: Applications received during the year 43 33
69 51
Less: Disposed of -
Rulings made 36 26
Applications withdrawn 12 8
Rulings declined 3 51 6 40
Awaiting decision at the end of the year 18 11
Advance Pricing Arrangement
An Advance Pricing Arrangement (APA) is an arrangement that determines in advance an appropriate set of criteria for the determination of the transfer pricing of cross-border transactions between associated enterprises. The APA process gives enterprises the opportunity to reach agreements with tax administrations on the method of applying the arm’s length principle so that transfer pricing issues can be more efficiently dealt with in real time, thus avoiding the risk of transfer pricing audit later. This arrangement enables enterprises to better assess their tax exposure and facilitates their business operation.
A unilateral APA is an arrangement between the Commissioner and the enterprise concerning the transfer pricing of its cross-border transactions with an associated enterprise. As the APA process does not involve the agreement with a comprehensive avoidance of double taxation agreement (CDTA) partner, it does not guarantee the agreement of the CDTA partner to the arrangement made.
A bilateral APA is an arrangement between the Commissioner and a CDTA partner concerning the transfer pricing of the abovementioned cross-border transactions. It therefore provides certainty to enterprises that double taxation will not arise. The same also applies to a multilateral APA which is a similar arrangement involving the partners of two or more CDTAs.
The Department rolled out the APA programme in April 2012. At present, the Department will only consider bilateral or multilateral APA applications due to resource constraints and the deficiency of a unilateral APA.
Up to 31 March 2018, the Department has received quite a number of applications in relation to CDTA with different partners including the Mainland of China, Japan, Korea, Malaysia, the Netherlands and Thailand.
These cases are currently under different stages of the APA programme and a few of them have already been completed.
Objections
A taxpayer who is aggrieved by an assessment may lodge a notice of objection to the Commissioner within the prescribed time limit. If the objection is against an estimated assessment raised in the absence of a tax return, a properly completed return, together with the supporting accounts where applicable, must also be accompanied with the notice of objection. A significant proportion of the objections received each year arise from estimated assessments. Most of these objections are settled promptly by reference to the returns subsequently received. Many of the other types of objections are also settled by agreement between the taxpayers and the assessors concerned. Only relatively few objections are ultimately referred to the Commissioner for determination. During 2017-18, the Department completed the processing of 79,205 objections (Figure 12).
Figure 12 Objections
2016-17 Number
2017-18 Number
Being processed at the beginning of the year 37,660 40,011
Add: Received during the year 91,106 80,497
128,766 120,508
Less: Disposed of -
Settled without determination 88,238 78,695
Determinations:
Assessments confirmed 298 285
Assessments reduced 128 122
Assessments increased 82 97
Assessments annulled 9 517 88,755 6 510 79,205
Being processed at the end of the year 40,011 41,303
Appeals to the Board of Review
A taxpayer who is dissatisfied with the Commissioner’s determination of his objection may appeal to the Board of Review (Inland Revenue Ordinance) (the Board). The Board is an independent statutory body. As at 31 March 2018, the Board consisted of a chairman and 8 deputy chairmen, who have legal training and experience, as well as 64 members. During 2017-18, the Board settled 55 appeal cases (Figure 13).
Figure 13 Appeals to the Board of Review
Number
Awaiting hearing or decision as at 1 April 2017 32
Add: Received during the year 54
86 Less: Disposed of -
Withdrawn 21
Decided:
Assessments confirmed 13
Assessments reduced in part 3
Assessments increased 16
Assessments annulled 1
Others 1 34 55
Awaiting hearing or decision as at 31 March 2018 31
Appeals to the Courts
A decision of the Board is final, provided that either the taxpayer or the Commissioner may, pursuant to section 69 of the Inland Revenue Ordinance, appeal to the Court of First Instance against the Board’s decision on a question of law. Before 1 April 2016, taxpayers or the Commissioner may only appeal to the court by way of case stated from the Board. With effect from that date, the case stated procedure was abolished and no appeal may be made unless leave to appeal has been granted by the court, on the application of the taxpayer or the Commissioner.
During 2017-18, the Court of First Instance ruled on two cases relating to the Inland Revenue Ordinance. In one of the tax appeals, although the Commissioner was granted leave to appeal, the court did not agree that the relevant income should be subject to Salaries Tax instead of Profits Tax. The other tax appeal was referred to the court by way of case stated. The principal issue of that appeal was whether there had been a change of the taxpayer’s intention with respect to a piece of land. The taxpayer appealed to the Court of Appeal after its appeal was dismissed.
The Hong Kong Court of Final Appeal Ordinance provides that, a taxpayer or the Commissioner may, with the leave of the Court of Appeal or the Court of Final Appeal, appeal against the judgment of the Court of Appeal. During 2017-18, there was no tax appeal to the Court of Final Appeal.
Figure 14 sets out the statistics concerning appeals to the Courts during 2017-18.
Figure 14 Appeals to the Courts
Court of First Instance Court of Appeal Total
Awaiting hearing or decision as at 1 April 2017 4 1 5
Add: Lodged during the year 0 1 1
4 2 6
Less: Disposed of 2 0 2
Awaiting hearing or decision as at 31 March 2018 2 2 4
Business Registration
The Department aims to maintain an efficient business registration system. A person carrying on a business in Hong Kong must register the business and pay the required fee and levy. The number of business registrations as at 31 March 2018 stood at 1,532,677, which was an all time high. It was 31,950 more than that as at 31 March 2017 (Figure 15).
Figure 15 Number of business registrations
1,600 1,400
1,235,361 1,271,522
265,366 261,155
1,200 1,000 800 600
200 400
0
31.3.2017 31.3.2018
('000)
1,500,727 1,532,677
Corporations Unincorporated Businesses
Business registration certificates are generally valid for one year, but businesses may elect for 3-year certificates. As at 31 March 2018, 23,832 businesses held 3-year certificates.
As the waiver of business registration fees expired on 1 April 2017, the amount of business registration fees and penalties collected in 2017-18 increased significantly to $2.7 billion, an increase of 1,096% compared with last year (Figure 16). Business registration statistics are set out in Schedule 8.
Figure 16 Business registration statistics
2016-17 2017-18 Increase/Decrease
Number of certificates paid (Main and Branch) 1,530,879 1,493,423 -2.4%
Fees (inclusive of penalties) collected ($m) 228 2,726 +1,096%
Under the Business Registration Ordinance, a small business with average monthly sales or receipts below a specified limit ($10,000 for businesses deriving profits mainly from the sale of services, and $30,000 for other businesses) can apply for exemption from payment of the business registration fee and levy. Where an application for exemption is not allowed, the business operator may appeal to the Administrative Appeals Board. The number of exemptions granted during 2017-18 was 14,856, representing an increase of 42.2%
from the previous year. No appeal case was received by the Board during the last three years.
Stamp Duty
Stamp duty is charged on instruments effecting property transactions, stock transactions and leasing of property in Hong Kong (Figure 17).
Figure 17 Composition of stamp duty collections
Shares (39%)
Immovable Properties
(60%) Leases etc.
(1%)
2017-18 The Stamp Duty (Amendment) Ordinance 2018 (the
Amendment Ordinance) was gazetted on 19 January 2018. The Amendment Ordinance stipulates that unless exempted, the ad valorem stamp duty rate on instruments executed on or after 5 November 2016 for dealing with residential properties is increased to a flat rate of 15%.
Besides, upon the gazettal of the Amendment Ordinance, certain instruments of residential property transaction executed during the transitional period (5 November 2016 to 18 January 2018) were chargeable with additional stamp duty. Also, there was an increase in the number of immovable property transactions in 2017-18 when compared with that for 2016-17. All these factors contributed to the sharp increase in the amount of stamp duty collection from property transactions by 53% ($19.9 billion).
Further, the increase in total turnover of the Hong Kong stock market in 2017-18 led to a significant increase in the amount of stamp duty collection from Hong Kong stock transactions by 57% ($13.3 billion).
Overall, there was an increase of 54% ($33.3 billion) in the total stamp duty collection for the year 2017-18 (Figure 18 and Schedule 9).
Figure 18 Stamp duty collections
2016-17 ($m)
2017-18
($m) Increase
Immovable Properties 37,518 57,376 +53%
Shares 23,567 36,930 +57%
Leases and other documents 814 867 +7%
Total 61,899 95,173 +54%
Estate Duty
Estate duty is charged on a deceased person’s estate situated in Hong Kong. The threshold for levying duty is $7.5 million and the duty rates range from 5% to 15%, depending on the value of the estate.
The Revenue (Abolition of Estate Duty) Ordinance 2005 came into effect on 11 February 2006 abolishing estate duty in respect of persons passing away on or after that date. The estate duty chargeable in respect of estates of persons died between the period 15 July 2005 to 10 February 2006, with the principal value exceeding
$7.5 million, is reduced to a nominal amount of $100. The number of new cases was 665 in 2017-18, an increase of 13% from the last year (Figure 20).
Figures 19 and 20 show the composition of estates and cases processed for the past two years.
Figure 19 Composition of estates
83%
34.1%
5.3%1.9%
25.5% 33.2%
1%
16%
Immovable Properties Quoted Shares Unquoted Shares
Bank Deposits Others
2016-17
2017-18
Figure 20 Estate duty cases
2016-17 Number
2017-18 Number
New cases 586 665
Cases finalised
- Dutiable 11 3
- Exempt 558 632
569 635
Estate duty of $31 million was collected during the year (Schedule 10), an increase of $12 million (63%) compared with the previous year.
Estate duty is payable on delivery of an estate duty affidavit or account (or within 6 months from the date of the deceased’s death, whichever is the earlier). $10.8 million was received during the year in advance of the issue of formal assessments (Schedule 10).
Betting Duty
Betting duty is charged on the net stake receipts from betting on horse races and football matches and on the proceeds of Mark Six lotteries, all administered by the Hong Kong Jockey Club. In 2017-18, the rates of betting duty on these betting activities remained unchanged (Figure 21).
Figure 21 Rates of betting duty in 2017-18
Rate Horse racing
Local bets on local horse races Net stake receipts
the first $11 billion 72.5%
the next $1 billion 73%
the next $1 billion 73.5%
the next $1 billion 74%
the next $1 billion 74.5%
the remainder 75%
Local bets on non-local horse races Net stake receipts 72.5%
Mark Six lotteries Proceeds 25%
Football betting Net stake receipts 50%
The total betting duty collected in 2017-18 was 4% higher than that of the previous year (Figure 22 and Schedule 11).
Figure 22 Betting duty collections
2016-17 ($m)
2017-18
($m) Increase/Decrease
Horse racing 12,757.9 13,281.8 +4.1%
Mark Six lotteries 2,126.9 2,023.3 -4.9%
Football betting 6,234.2 6,654.0 +6.7%
Total 21,119.0 21,959.1 +4.0%
Tax Reserve Certificates
Taxpayers may purchase Tax Reserve Certificates (TRCs) under two situations.
The first situation applies to taxpayers who wish to save for the payment of their future tax liabilities. The Department has set up two schemes, namely the “Electronic Tax Reserve Certificates Scheme” for all taxpayers and the “Save-As-You-Earn” (SAYE) Scheme for civil servants and civil service pensioners. With a Tax Reserve Certificate account, taxpayers may purchase TRCs by various channels, including bank auto-pay, telephone, the Internet and bank ATM. Under the “SAYE Scheme”, civil servants and civil service pensioners can purchase TRCs through monthly deductions from their salaries / pensions. Interest is payable on the TRCs when they are redeemed for settlement of tax liabilities, based on the interest rate prevailing at the time of purchase, for a maximum period of 36 months from the date of purchase.
In 2017-18, there was an increase of 0.6% in the number but a decrease of 5.2% in the amount of TRCs sold under the “Electronic Tax Reserve Certificates Scheme”. For the “SAYE Scheme”, there was an increase of 0.05% and 1.7% respectively in the number and the amount of TRCs sold (Schedule 12). Overall, the total amount of TRCs sold decreased by 4.2% (Figure 23).
The second situation applies to taxpayers who object to tax assessments and are required to purchase TRCs in respect of the tax in dispute. Such TRCs are used to settle any tax found payable upon the finalisation of the objection or appeal. Interest is only payable on the amount of the TRC, if any, subsequently required to be repaid to the taxpayer, and is computed at floating rates over the tenure of the TRC.
Figure 23 Certificates sold
100
60 80
20 40
0 1,632 1,628
91,138 91,456
2016-17 2017-18
('000)
Certificates relating to Objections and Appeals Number
553.5 530.1
2016-17 2017-18
4,500
3,500
2,500
1,500
500 4,000
3,000
2,000
1,000
0
3,186.5
4,493.1 ($m)
Certificates other than for Objections and Appeals Amount
4 Collection
Revenue collected by the Department includes tax, additional tax, surcharge and fines. Schedules 13 and 14 provide details of additional tax, surcharge and fines imposed by the Department in respect of earnings and profits tax during 2017-18.
Collection of Tax
Taxpayers can conveniently settle their tax liabilities by various payment methods, including electronic payment (by phone, bank ATM or via the Internet), payment in person or payment by post. For earnings and profits tax, electronic payment remains most popular. 55% of the earnings and profits tax payment transactions in 2017-18 were made through electronic means. Figure 24 shows the respective percentages of the different payment methods used by taxpayers under earnings and profits tax and total revenue.
Figure 24 Payment methods
Earnings & profits tax Number of transactions in 2017-18
By ATM (7%)
By Post (4%)
Via Internet (33%)
In Person (41%) By Phone
(15%)
Total revenue (including other duties) Number of transactions in 2017-18
By ATM (4%)
By Post (4%)
Via Internet (25%)
In Person (58%) By Phone
(9%)
Refund of Tax
Tax refunds were made mainly due to two reasons, namely, overpayment of tax by taxpayers and revision of assessments. There were 616,548 refund cases in 2017-18, representing a decrease of 20.4%. The total amount of refunds was $17.9 billion, representing an increase of $1.24 billion or 7.5% compared with the previous year (Figure 25).
Figure 25 Tax refunds
2016-17 2017-18
Type of tax Number Amount ($m) Number Amount ($m)
Profits tax 49,942 7,919.8 49,321 9,152.4
Salaries tax 635,828 4,654.8 501,060 4,581.9
Property tax 18,495 191.1 15,966 162.7
Personal assessment 31,498 387.7 26,549 388.4
Others 38,689 3,509.1 23,652 3,619.5
Total 774,452 16,662.5 616,548 17,904.9
Recovery of Tax in Default
Taxpayers should pay tax on or before the due date shown on the demand notes issued to them. The vast majority of taxpayers settle their tax liabilities in a timely manner.
A late payment surcharge of 5% will generally be imposed where tax is in default. If tax debts remain outstanding for more than six months after the due date, the Department may impose a further surcharge of 10% on the total unpaid amount.
Any tax in default is immediately recoverable. Recovery notices can be issued to employers, bankers, debtors and persons holding money on behalf of the defaulting taxpayers to effect collection. Actions may also be commenced in the District Court. Figure 26 summarises different types of recovery actions taken by the Department.
Figure 26 Recovery action
5% Surcharge Notice Number of notices
260
240
220
200
2014-15
242,816
2015-16 243,173 243,089
224,785
2016-17 2017-18
('000) Total amount
2014-15 2015-16 2016-17 2017-18 300
225
150
75
0
273
240 255 264
($m)
Figure 26 Recovery action (continued)
10% Surcharge Notice Number of notices
21,000 24,000
18,000
12,000 15,000
2014-15
20,774
2015-16 17,277
19,695
21,828
2016-17 2017-18
Total amount
2014-15 2015-16 2016-17 2017-18 160
120
80
40
0
146
108 116 126
($m)
Recovery Notice
Number of notices 150
140
130
120 2014-15
140,451
2015-16 135,654
142,708 141,004
2016-17 2017-18
('000) Total amount
2014-15 2015-16 2016-17 2017-18 12,000
9,000
6,000
3,000
0
11,934
7,532 6,954
10,595 ($m)
Upon entry of judgment, a defaulting taxpayer becomes liable to legal costs and interest on judgment debt for the period from the date of commencement of proceedings to the date of full settlement in addition to the outstanding tax. Figure 27 shows the legal costs and judgment interest collected during 2017-18.
Figure 27 Legal costs and judgment interest collected in 2017-18
$ $
Court cost
Court fees 802,717
Execution fees 13,415 816,132
Fixed cost 334,254
Judgment interest
Pre-judgment interest 1,779,227
Post-judgment interest 8,877,304 20,656,531
Total costs and interest collected 21,806,917
1
Furthermore, the Commissioner may apply to a District Judge to prevent a person with tax in default from leaving Hong Kong. If the District Judge is satisfied that it is in the public interest to ensure that the person does not depart from Hong Kong, or if he returns, does not depart again, without first paying the tax or furnishing security to the satisfaction of the Inland Revenue Department for payment of that tax, he shall issue the “departure prevention direction”. The person concerned has the right to appeal to the Court of First Instance of the High Court against the District Judge’s decision.
5 Field Audit and Investigation
The Field Audit and Investigation Unit is responsible for conducting field audits and investigations on businesses and individuals with a view to combating tax evasion and avoidance. Back tax is assessed and penalties are generally imposed where discrepancies are detected.
During 2017-18, the Field Audit and Investigation Unit completed 1,804 cases (including tax avoidance cases) and assessed back tax and penalties of about $2.5 billion (Figure 28).
Figure 28 Results of the Field Audit and Investigation Unit
2014-15 2015-16 2016-17 2017-18
Number of cases completed 1,803 1,804 1,801 1,804
Understated earnings and profits ($m) 12,857.9 13,888.8 12,408.8 11,687.7
Average understatement per case ($m) 7.1 7.7 6.9 6.5
Back tax and penalties assessed ($m) 2,533.1 2,538.3 2,528.4 2,526.2
Back tax and penalties collected ($m) 2,861.4 1,824.2 2,386.8 2,231.1
Field Audit
In 2017-18, there were 17 Field Audit sections. Field audit is conducted on both corporations and unincorporated businesses. The work of field auditors entails site visits to business premises and examination of accounting records of taxpayers in order to ascertain whether correct returns of profits have been made.
Anti-tax Avoidance
Two of the 17 Field Audit sections concentrate on tackling tax avoidance schemes, whereas other investigation officers and field auditors handle avoidance cases on an operational need basis. During 2017-18, the Field Audit and Investigation Unit completed 208 tax avoidance cases and assessed back tax and penalties of about
$0.95 billion (Figure 29).
Figure 29 Results of the audit on tax avoidance cases
2014-15 2015-16 2016-17 2017-18
Number of cases completed 217 215 214 208
Understated earnings and profits ($m) 6,027.7 6,826.2 6,201.8 4,613.4
Average understatement per case ($m) 27.8 31.7 29.0 22.2
Back tax and penalties assessed ($m) 1,155.6 1,000.4 1,120.2 948.5
Investigation
In 2017-18, there were 5 Investigation sections. Investigation officers are responsible for conducting in- depth investigations into suspected tax evasion, and taking penal action (including prosecution proceedings in appropriate cases) as a deterrent.
Prosecution
One of the 5 Investigation sections is the prosecution section focusing on criminal investigation of tax evasion.
Tax evasion is a serious crime. A person convicted of tax evasion could be sentenced to imprisonment for up to 3 years and fined.
Property Tax Compliance Check
In addition to conducting audits on businesses, the Department also carries out verification checks on the correctness of rental income reported by property owners. In 2017-18, the Department completed compliance check on 234,726 property tax cases (Figure 30).
Figure 30 Results of the property tax compliance checks
2014-15 2015-16 2016-17 2017-18
Number of cases completed 161,860 186,229 209,499 234,726
Understated rental income ($m) 635.0 749.2 850.8 951.6
Back tax and penalties assessed ($m) 76.2 89.9 102.1 114.2
6 Taxpayer Services
IRD Website
www.ird.gov.hk
The IRD website is a very effective channel for disseminating tax information and providing electronic services to the public. W ith continuous enrichment and updates, the website enables taxpayers to obtain the most current information about Hong Kong taxation in a fast and convenient manner.
Through the website, members of the public can:
• obtain information on tax law, tax returns, tax obligations and answers to frequently asked questions;
• download IRD software and tax forms;
• use the interactive program to calculate their liability under salaries tax and personal assessment; and
• access to the personalised on-line tax services provided by the Department under eTAX.
To facilitate all sectors of the community to locate the relevant tax information, there are thematic content pages for individuals, businesses, employers, tax representatives, etc.
The IRD website conforms to web accessibility guidelines and there is also a mobile version to enable all users to have quick and convenient access to tax information.
Electronic Enquiry Service
Electronic enquiry services are provided to eTAX users at <www.gov.hk/etax>. They can view their tax position in relation to their returns, assessments and payments, etc. at any time.
Enquiry Service Centre
The Department’s Enquiry Service Centre handles telephone and counter enquiries. The Centre is equipped with a computer network linked to the Department’s Knowledge Database to enable our staff to provide, as far as possible, an immediate “one-stop” service.
Telephone Enquiry Service
The Centre operates an Interactive Telephone Enquiry System (ITES) with 144 telephone lines. Callers can have access on a 24-hour basis to a wide range of tax information by listening to recorded messages. Besides, callers can obtain facsimile copies of information sheets and forms through the system. A “Leave-and-call- back” facility, for recording information requests, and a “Fax-in enquiry” service are also available. The telephones are manned during office hours by staff who would readily serve the callers. The Centre also provides an eTAX help desk hotline to handle enquiries on eTAX services and provide technical support.
The statistics of services provided through ITES during 2017-18 are shown in Figure 31.
Figure 31 Statistics of services provided through ITES
2016-17 Number
2017-18
Number Increase/Decrease
Calls answered by staff 736,701 699,666 -5.0%
Calls answered by system 770,107 741,949 -3.7%
Leave-and-call-back messages 33,211 39,198 +18.0%
Documents supplied by fax 2,685 5,726 +113.3%
Counter Enquiry Service
Generally, the counter staff of the Centre is able to handle enquiries, collects mail items and issues forms on the spot without the need of referring callers to other sections in the Department for attention. The number of counter enquiries handled and forms issued during 2017-18 was about 0.68 million (Figure 32).
Figure 32 Counter enquiries
243,756 243,078
600 800
400
200
0
675,519 622,213
2017-18 2016-17
('000)
No. of callers No. of enquiries
Information leaflets on topics of general interest are available for collection at the form stand located on the first floor of Revenue Tower. The public may also obtain general tax information and download forms from the IRD website and GovHK <www.gov.hk>.
Tax-help Services for Completion of Tax Returns
On the IRD website, e-Seminars are provided for employers, property owners and individual taxpayers.
Information on how to complete tax returns, fulfil tax obligations and overcome difficulties in compliance is uploaded to the website. After reading the information, taxpayers can raise enquiries electronically at the “Q&A Corner”. The Department will reply the questions on a regular basis.
The Department issued 2.6 million Individuals Tax Returns for the year of assessment 2016-17 on 2 May 2017. To assist the taxpaying public in completing tax returns, the Department extended the service hours of telephone enquiry services in May 2017. Service hours from Monday to Friday were extended by one and a half hours till 7:00 pm and additional service was also provided on Saturday from 9:00 am till 1:00 pm.
During peak periods, the Department also redeployed manpower resources and employed part-time staff to strengthen daytime telephone enquiry services.
Complaints and Compliments
If taxpayers are dissatisfied with the services provided by the Department or their problems cannot be solved satisfactorily through normal channels, the Complaints Officer may be approached for assistance.
The complaint channel provides taxpayers with the means of having individual grievances dealt with independently at a senior level. This ensures that such cases are properly handled in a fair and impartial manner. During 2017-18, 255 complaint cases were received (Figure 33). This represents an increase of 0.4%, as compared with the previous year.
Figure 33 Complaint cases
Not substantiated Partially substantiated Substantiated
254 255 250
200 300
0 50 100 150
2017-18 2016-17
155 149
84 85
16 20
If taxpayers are dissatisfied with any administrative action taken by the Department, they may refer the matter to the Ombudsman. During 2017-18, the Ombudsman sought written comments from the Department in respect of 21 cases. In the light of these cases, the Department has reviewed relevant operations with a view to improving them.
Taxpayers may compliment the service of the Department. During the year, 185 Letters of Compliments were received.
Performance Pledge
The service standards a taxpayer can expect from the Department are set out in the performance pledges. The Department has achieved all the targets of performance pledges and excelled in some of the targeted performance with remarkable results during 2017-18.
7 Information Technology
The Department has been making extensive use of information technology to enhance operational efficiency and provide quality services to the public.
IT Environment
The Department has built up a comprehensive and integrated IT infrastructure with different types of computer application systems and platforms. The Department’s network connects the computer system and workstations of staff on different floors. Assessment process is automated by the “Assess-First-Audit-Later”
system. Tax audit and investigation work is facilitated by the use of data mining and advanced analytical tools.
The Document Management System and Workflow Management System enhance the control and monitoring of documents, files and workflow, facilitate the tracking of case progress, and thus enable the Department to improve overall service quality. A wide range of information is stored in the Department’s Intranet and General Enquiry Knowledge Database for convenient access by our staff at work. Moreover, e-mail and Internet facilities provide an efficient and environment-friendly communication platform for our staff.
In 2017-18, we successfully completed the System Infrastructure Enhancement project to migrate all the mainframe tax applications to the midrange platform and enhance the interoperability and overall efficiency of the computer systems.
Electronic Services
eTAX
The Department continues to provide a wide range of online tax services to the public, including internet filing of tax returns, e-stamping of property documents, business registration e-services, electronic notices, electronic payments and lodgement of applications, etc.
eTAX services are widely used by the public. As at 31 March 2018, there were some 807,000 registered eTAX users. The take-up rate increased year after year (Figure 34).
Figure 34 eTAX Usage Statistics
2016-17 Number
2017-18
Number Increase
Internet filing of tax returns
- Tax Return-Individuals, Property Tax Return and Profits Tax Return 567,583 610,378 +7.5%
- Employer’s Return of Remuneration and Pensions
BIR56A 13,517 14,278 +5.6%
IR56B 107,580 114,067 +6.0%
- Employer’s Notifications of Commencement of Employment, Cessation of Employment and Employee’s Departure from Hong Kong
19,145 23,506 +22.8%
Stamping of Property Document 292,224 310,141 +6.1%
Business Registration Number Enquiry 2,049,465 2,215,110 +8.1%
Application for Supply of Information on the Business Register
- Requisition 141,998 166,555 +17.3%
- Business registrations involved 440,471 469,681 +6.6%
Other Electronic Services
During 2017-18, some 43,800 employers furnished annual returns for 2,879,700 employees in total by diskettes, DVDs or USB storage devices. About 68% of these employers used the free software provided by the Department.
8 Human Resources
Organisation Chart of the Inland Revenue Department as at 31.3.2018
Commissioner
Deputy Commissioner (Technical)
Commissioner’s Unit Appeals
Technical Research Tax Treaty
Charitable Donations Complaints Internal Audit Special Duties
Forms &
General Support
Unit 1
Assessment and Review (Profits Tax - Corporations and
Partnerships)
Unit 2
Assessment (Salaries Tax, Profits Tax - Sole
Proprietorships, Property Tax - Sole Owners and
Personal Assessment)
Deputy Commissioner (Operations) Departmental
Administration Division
Unit 3 Collection Inspection Estate Duty Stamp Duty
Business Registration
Unit 4
Field Audit and Investigation
Headquarters Unit Information
Systems Training Enquiry Services
Document Processing Output Despatch
Tax Records
Assessment (Property Tax - Joint Owners and
Corporations) and Review (Profits Tax -
Sole Proprietorships, Property Tax and
Personal Assessment)
Overall Establishment
No. of Staff
Commissioner’s Office 82
Commissioner’s Unit 89
Headquarters Unit 702
Unit 1 363
Unit 2 766
Unit 3 611
Unit 4 239
Total 2,852
Establishment
The Commissioner, the two Deputy Commissioners and the five Assistant Commissioners, together with the Departmental Secretary, form the top management of the Inland Revenue Department.
Members of the Top Management of the Inland Revenue Department (as at 31.3.2018)
Mr YIM Kwok-cheong Assistant Commissioner
(Unit 1)
Ms FONG Wai-hang Assistant Commissioner
(Unit 2)
Ms TSE Yuk-yip Assistant Commissioner
(Unit 3)
Mr CHIU Sai-ming Assistant Commissioner
(Headquarters Unit)
Ms CHAN Fung-kuen Assistant Commissioner
(Unit 4)
Mr CHIU Kwok-kit Deputy Commissioner
(Technical)
Mr WONG Kuen-fai Commissioner
Mr TAM Tai-pang Deputy Commissioner
(Operations)
Miss LEUNG Shun-chee, Evelyn Departmental Secretary
As at 31 March 2018, the Department had an establishment of 2,852 permanent posts (including 27 directorate posts) in the Commissioner’s Office and the 6 Units of the Department. Of the total, 1,941 posts were in departmental grades (namely Assessor, Tax Inspector and Taxation Officer grades), performing duties directly concerned with taxation. The remaining 911 posts were in common / general grades, providing administrative, information technology and clerical support services (Figure 35).
Figure 35 Staff establishment
3,000
2,000
1,000
0
2,832 2,833 2,841 2,852
926 914 912 911
1,089 1,102 1,104 1,110
105 105 105 105
712 712 720 726
2017-18 2015-16 2016-17
2014-15
Assessors (Professional)
Tax Inspectors
Taxation Officers
Common / general grade officers
Most of the professional officers serving in the Department were below the age of 45 (Figure 36). The ratio of male to female professional officers was 1:1.6.
Figure 36 Age and gender profiles of professional staff (on strength basis)
Age Group Male Female Total
Below 25 23 (8%) 14 (3%) 37 (5%)
25 to below 35 71 (25%) 154 (35%) 225 (31%)
35 to below 45 40 (14%) 97 (22%) 137 (19%)
45 to below 55 108 (39%) 138 (31%) 246 (34%)
55 and over 39 (14%) 40 (9%) 79 (11%)
Total 281 (100%) 443 (100%) 724 (100%)
Staff Promotions and Turnover
In 2017-18, a total of 60 departmental grade officers and 17 common / general grade officers were promoted.
Among them, 4 were directorate officers. 227 officers joined the Department, of which 127 were new appointees and 100 were officers transferred from other grades / departments. A total of 175 officers (including 37 transferred to other departments) left the Department.
Training and Development
Staff are the Department’s valuable assets. We recognise the importance of providing opportunities of continuous learning to our staff to keep them abreast of the changing environment and to acquire the necessary knowledge to perform their duties. A variety of training courses in taxation, accounting, interpersonal skills, management, languages, computer, etc. are offered to staff members. In 2017-18, our staff received training for a total of 10,596 man-days, which was equivalent to about 3.72 man-days per officer.
The major training activities conducted for our staff during 2017-18 were as below:
Training Courses
• Induction courses for all grades of staff upon joining the Department
• Two-year taxation law and practice course for newly appointed Assistant Assessors
• Briefing sessions on legislative amendments and new services
• Refresher courses on professional knowledge
• Courses on Hong Kong Accounting Standards
• Written and spoken English courses
• Putonghua courses
• Computer courses
Workshops
• Leadership and teamwork workshop
• Mentorship workshop
• Performance appraisal workshops on English writing and interviewing skills
• Workshop on bringing out the best in people
• Workshop on building resilience
• Workshop on customer service skills on the telephone
• Workshop on effective communication in the workplace
• Workshop on emotional wellness
• Workshop on essential supervisory skills
• Workshop on foreign enterprises in the Mainland – legal and regulatory requirements
• Workshop on how to handle difficult taxpayers
• Workshop on interviewing and negotiation skills
• Workshop on leading innovation and change
• Workshop on problem solving and decision making
• Workshop on handling confrontational situations in customer service
Continuing Professional Education
11 seminars were held by the Training Committee under the in-house Continuing Professional Education (CPE) Programme on the following subjects for professional officers:
• Cross-border Transfer Pricing Issues between the Mainland and Hong Kong
• Intellectual Property in Hong Kong
• The Companies (Winding Up and Miscellaneous Provisions) (Amendment) Ordinance 2016 and Bankruptcy (Amendment) Ordinance 2016
• China’s New Transfer Pricing Compliance Requirement
• International Tax Updates
• Listing in Hong Kong
• Tax Inspectors’ Work on Prosecutions
• Hong Kong Tax concessions for Aircraft Leasing
• Belt and Road Initiative – Tax Implications in the Mainland and Hong Kong
• BEPS Updates
• Annual Update of Appeal Cases
Speakers for 3 of the seminars were staff members and others were experts from various fields. A total of 1,018 staff members attended these seminars. The video files of the CPE seminars were uploaded onto the Department’s Intranet and a total of 1,017 staff members had viewed these video files.
Courses in the Mainland and Overseas
In order that our professional officers may broaden their horizons and acquire the necessary knowledge to cope with new and complex global issues, they are sent to participate in overseas training programmes. In 2017-18, 28 officers went to the Mainland, Korea, Malaysia, Singapore and Vietnam to attend training courses on different issues and 6 to universities in the Mainland for national studies courses and 1 to Beijing for foreign affairs studies programme.
Continuous Learning
Besides the conventional classroom training, the Department employs various means to promote continuous self-learning. These include encouraging staff to take the web courses provided by the CLC Plus of CSTDI and providing financial support to officers to attend seminars and courses organised by academic and professional institutes. In 2017-18, 7 officers were sponsored by the Department to attend the relevant courses. Training materials and information are uploaded onto our Intranet for officers to study in their own time and at their own pace. This provides an effective way for the staff to acquire new knowledge and refresh what they have learnt.
Mentorship Scheme
A Mentorship Scheme for Assistant Assessors has been set up since 2008. Under this scheme, experienced officers (the mentors) will guide newly recruited Assistant Assessors (the mentees) to broaden their perception about the Department such as the organisation structure, work, connection and culture, and help them integrate into the civil service.
Staff Relations and Welfare
The Department attaches great importance to staff relations and welfare. We strive to maintain effective communication, and promote co-operation and mutual trust between the management and staff at all levels that help enhance the Department’s operational efficiency and productivity.
The Departmental Consultative Committee
The Departmental Consultative Committee provides a formal and effective platform for the management and staff to exchange views on matters of mutual concern such as recruitment, promotion, career posting, training, working environment, staff welfare, office security and safety. The Committee is chaired by the Deputy Commissioner (Operations) and composed of representatives from all staff unions / associations and staff groups in the Department.
The General Grades Consultative Committee
The General Grades Consultative Committee, chaired by the Departmental Secretary and composed of representatives from the clerical and secretarial grades, allows the general grades staff members to discuss with the management issues of specific interest to their grades.
The “Meet-the-Staff Programme”
First launched in 1996-97, the “Meet-the-Staff Programme” enables the senior management of each Unit and staff of different sections / groups to exchange ideas face to face on departmental and service-wide issues in an open and relaxed manner. It serves to supplement the formal consultative channel and effectively enhances communication between staff and the management.
The IRD Staff Suggestions Scheme
In 2017-18, 4 out of 10 suggestions made through the IRD Staff Suggestions Scheme were granted cash awards and certificates of commendation in recognition of their contributions on enhancing operational efficiency and quality of services of the Department.
The Inland Revenue Department Newsletter
The Departmental Newsletter, published every 4 months, serves as another channel of communication between staff and the management promoting a sense of belonging in the Department. Articles are contributed by unit management for disseminating service-related issues, staff movement, staff welfare, information technology, environmental and green issues, occupational health and safety matters, etc., and by staff who are keen to share their leisure activities and hobbies. The Newsletter also provides a regular roundup on the recreational activities organised by the IRD Sports Association as well as volunteer activities arranged by the IRD Volunteer Team.
The Inland Revenue General Staff Welfare Fund
Established in 1972, the Inland Revenue General Staff Welfare Fund operates on funds donated by staff on a voluntary basis. It aims to provide within a short time small amount of interest free loan, as an additional and quick emergency relief, to help staff in unexpected financial hardship. The Fund is managed by a Governing Committee, chaired by the Departmental Secretary and composed of staff representatives from the Departmental Consultative Committee, the General Grades Consultative Committee and the IRD Sports Association. The Claims Sub-committee, formed under the Governing Committee, considers and approves applications for financial assistance submitted by staff.
Commissioner’s Commendation Letter Scheme
In 2017-18, 39 officers who had provided outstanding service for a long period of time were awarded the Commissioner’s Commendation Letter. The presentation ceremony was held in March 2018.
Secretary for the Civil Service’s Commendation Award 2017
In 2017, 1 Senior Assessor and 1 Senior Taxation Officer were awarded the Secretary for the Civil Service’s Commendation in recognition of their exceptionally meritorious and consistently outstanding performance.
The presentation ceremony was held in November 2017.
The Long and Meritorious Service Travel Award Scheme
In 2017-18, 28 officers with long and meritorious service were granted awards of overseas travel under the Long and Meritorious Service Travel Award Scheme.
Visit of the Secretary for the Civil Service
The Secretary for the Civil Service, Mr. LAW Chi-kong, visited the Department on 7 August 2017. After meeting with the management for a brief update on our work, Mr. LAW made a tour to the Document Processing Centre and the Central Telephone Enquiry to learn more about their daily operation and services.
Mr. LAW has also met with staff representatives of various grades to exchange views on matters of mutual concern.
Visit of the Secretary for Financial Services and the Treasury
The Secretary for Financial Services and the Treasury, Mr. James LAU, visited the Department on 5 September 2017. He was accompanied by the Under Secretary, Mr. CHAN Ho-lim, and Permanent Secretary (Treasury), Ms. LAU Yim. To understand more of our daily operations, Mr. LAU visited the Document Processing Centre, the Central Enquiry Counter and the Stamp Office after meeting with the senior management.
