A promising economic outlook

To further boost Hong Kong’s economic vitality, the Financial Secretary announced a series of tax relief measures and personalallowance increases in the new Budget , including concessions on rates for both residential and nonresidential properties, salaries tax and personal assessment, as well as higher allowances for child care, supporting elderly parents and other items. Chong added that the government’s simultaneous increase in stamp duty on residential property transactions follows he principle of “those who can afford more, pay more”. This measure eases the burden on grassroots households while boosting government revenue, making it an appropriate tax adjustment initiative. He described the Budget as a moderate one that balances the economic development of all sectors.

In particular, he commended the government’s forward-looking decision to issue more long-term bonds, noting that this will help establish stable long-term expectations for investment returns. He believes the move will boost the development of Hong Kong’s bond market and bring a positive impact to the local economy.

Integrating into national policy blueprint to accelerate the building of an AI industry ecosystem

Titled “Driving High-quality, Inclusive Growth with Innovation and Finance”, this year’s Budget signals the government’s resolve to fully advance the development of innovation, technology and AI industries in the days ahead. In addition to announcing the establishment of the AI+ and Industrial Development Strategy Committee, chaired by the Chief Executive, the government is taking a multi-pronged approach – covering basic research and development, computing infrastructure, and enhancing public understanding and application of AI – to create an enabling environment for the development of Hong Kong’s AI industry ecosystem and industrial transformation on all fronts. “This year marks the first year of the 15th Five-Year Plan, which explicitly states support for Hong Kong in developing into an international innovation and technology hub. As the government actively integrates into the overall national development, all sectors of society can perform their respective duties, adapt to market changes with targeted transformation and adjustments, respond flexibly to current social changes, and keep pace with economic development.”

Unlocking new growth drivers

Some in the community have commented that the Budget includes few one-off relief measures benefiting the general public, with limited direct financial support for citizens. Chong explained that while such relief measures can ease citizens’ financial

pressure and stimulate immediate consumer spending in the short term, the core of fiscal planning lies in prudence and predictable returns, so as to sustainably fuel Hong Kong’s long-term economic development. Therefore, the focus should not be limited to short-term financial handouts. He also emphasized that the Budget upholds the principle of prudent fiscal management overall, while increasing investment in a number of high-potential economic sectors including innovation and technology, finance, and AI education and talent development. This fully demonstrates the government’s aim to raise the overall social productivity through policy leadership and investment. “The community should view the Budget ’s adjusted investment allocations from a macro perspective,

and discern the groundwork it has laid for Hong Kong’s future economic transformation. I believe that with the concerted efforts and united resolve of all sectors of society, Hong Kong will surely seize new opportunities and embark on a new journey amid the ever-changing global economic landscape.”