MPF Contribution Income Bands Raised at Both Ends: 337,000 Exempt, 510,000 to Pay More

Following the minimum wage law, the government proposes raising the MPF minimum relevant income from HK$5,000 to HK$6,500 a month and the maximum from HK$20,000 to HK$25,000. In one stroke, 337,300 low-income employees and self-employed workers leave the contribution net, saving up to HK$325 a month — while 510,000 people earning over HK$20,000 must contribute up to HK$250 more a month.

Who gains? Who pays more?

Lower earners get relief; higher earners pay up. The change comes in two steps: the minimum level takes effect this November, the maximum a year later next June after a transition period.

What does it mean for the wallet?

The exempt save HK$325 a month; those paying more contribute up to HK$3,000 extra a year, with a matching rise in the tax deduction. The government estimates its own MPF bill rises HK$13.4 million a year, while tax revenue falls HK$360 million.

How big is the long-run difference at retirement?

Assuming 30 years of contributions at 5% annual return, the impact is material:

In short: lower earners breathe easier now but retire with less; higher earners pay more now and retire with more. Policy is always a trade-off — the key is for workers to do their own sums. Compare MPF funds’ fees and returns at MPF fund comparison.