Rising Stock Stamp Duty Puts Hong Kong on Track for Operating Surplus
Stronger equity market activity is lifting government revenue and improving the city’s fiscal outlook
Hong Kong’s operating account is expected to return to surplus earlier than previously forecast, supported by a sharp rise in revenue from stamp duty on stock market transactions.
The improvement reflects stronger trading activity in the local equity market, which has generated higher-than-anticipated tax receipts and eased pressure on public finances.
The city’s finance chief said the operating account, which measures recurring income and expenditure, is benefiting directly from the pickup in market turnover.
This development marks a notable shift from earlier projections that anticipated a shortfall for the current fiscal year, and it underscores the central role of financial services in sustaining government revenue.
While the operating position is improving, the broader consolidated accounts are expected to remain in deficit due to continued heavy spending on long-term infrastructure projects and strategic development initiatives.
Officials have stressed that these investments are essential to Hong Kong’s future growth and competitiveness, even as they weigh on headline fiscal balances.
The prospect of an operating surplus has also renewed discussion around fiscal discipline and revenue stability, with policymakers emphasising the need to manage expenditure carefully while preserving Hong Kong’s strengths as an international financial centre.
The rebound in stamp duty income is being viewed as an encouraging sign of market confidence and economic resilience.
The improvement reflects stronger trading activity in the local equity market, which has generated higher-than-anticipated tax receipts and eased pressure on public finances.
The city’s finance chief said the operating account, which measures recurring income and expenditure, is benefiting directly from the pickup in market turnover.
This development marks a notable shift from earlier projections that anticipated a shortfall for the current fiscal year, and it underscores the central role of financial services in sustaining government revenue.
While the operating position is improving, the broader consolidated accounts are expected to remain in deficit due to continued heavy spending on long-term infrastructure projects and strategic development initiatives.
Officials have stressed that these investments are essential to Hong Kong’s future growth and competitiveness, even as they weigh on headline fiscal balances.
The prospect of an operating surplus has also renewed discussion around fiscal discipline and revenue stability, with policymakers emphasising the need to manage expenditure carefully while preserving Hong Kong’s strengths as an international financial centre.
The rebound in stamp duty income is being viewed as an encouraging sign of market confidence and economic resilience.
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