Tax cut planned for re/insurance

A bill was proposed by the Hong Kong government recently to reduce the profits tax to 8.25 percent – half of the normal rate – for all general reinsurance business of direct insurers, selected general insurance business of direct insurance, and some quarters of insurance brokerage.

In addition, Lloyd’s and an association of underwriters approved by the Insurance Authority would also fall under the scope of this regulation, should it be passed.

“The bill will implement the policy initiative in the 2018 Policy Address and the 2019-20 Budget speech respectively of providing tax relief to promote the development of marine insurance and the underwriting of specialty risks in Hong Kong. This policy initiative will also support and enhance the development of high value-added maritime services,” a spokesman for the Financial Services and the Treasury Bureau said to MNE Tax.

The tax concession bill will be introduced into Hong Kong’s Legislative Council for its first reading on December 18, the Inland Revenue Department stated.