ACCA Projects HK$75 Billion Surplus, Proposes Tax Relief for MPF Voluntary Contributions

The Association of Chartered Certified Accountants expects this fiscal year’s government surplus to hit HK$75 billion, and wants relief for the middle class — including wider salaries-tax bands. It also proposes tax deductions for private health insurance and MPF voluntary contributions, to encourage retirement and medical provisioning.

Why give tax breaks for voluntary contributions?

Mandatory contributions are not enough for retirement — incentives are needed to get people to save more. The logic from joint tax committee co-chairman Patrick Wong is straightforward: MPF’s mandatory 5%-each contributions leave many short of retirement needs, and tax relief would give a tangible reason to top up. International experience shows tax incentives are among the most effective tools for boosting voluntary retirement saving.

What else does the body propose?

Wider tax bands for the middle class; careful handling of property curbs. The ACCA suggests widening salaries-tax bands to help the middle class fight inflation, and says more land supply will help prices long term — but short-term anti-speculation steps, such as restricting who can buy flats, interfere with the market and need care. Long term, it says, the Hong Kong dollar’s US peg deserves review.

What should workers take away?

Are voluntary contributions worth it before any tax break? Without tax relief there is no extra sweetener — the case rests purely on long-term compounding and retirement needs. But if the government takes up the idea, voluntary contributions could one day become a tax-saving tool on par with the “tax-deduction trio”. Workers should watch whether the Budget gives it the green light.

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