Policy Address Unveils SME Support and Tax Incentives for Key Industries
SingTao · 1 SOURCESabout 4 hours ago2 MIN
Summary
Chief Executive John Lee Ka-chiu unveiled 10 measures to support small and medium enterprises (SMEs) in the 2026 Policy Address, focusing on helping businesses boost sales, expand into new markets and pursue overseas growth. The Financial Secretary is set to propose tax incentives offering a 5% or half-tax concession rate for qualifying enterprises in key industries by the end of 2026. Additionally, multiple government departments including the Tax Revenue Department may join the Monetary Authority's Commercial Data Interchange to enhance loan processing efficiency.
Key Points
- The BUD Fund (Branding, Upgrading and Domestic Sales Fund) will see its subsidy scope expanded, while the Easy BUD programme's ceiling has been raised to 150,000 yuan
- Government sources indicate that with the economic recovery, measures now prioritise helping SMEs increase sales and expand market reach, targeting both quantity and quality of growth
- The Commerce and Finance Branch plans to submit a bill to LegCo by end-2026 granting 5% or half-tax concessions to finance, advanced manufacturing, R&D, headquarters, logistics and supply chain enterprises
- Tax incentive approvals will be assessed individually, with enterprises planning large-scale hiring or developing strategic emerging industries in Hong Kong having higher chances of success
- The Inland Revenue Department is among potential departments to join the Commercial Data Interchange, alongside the Business Registration Office and Land Registry which have already connected
Why It Matters
The combination of expanded SME subsidies and targeted tax incentives represents a strategic shift towards attracting high-value industries to Hong Kong amid regional competition. Connecting more departments to the Commercial Data Interchange could significantly reduce loan processing times, addressing a longstanding pain point for SMEs seeking financing .
The combination of expanded SME subsidies and targeted tax incentives represents a strategic shift towards attracting high-value industries to Hong Kong amid regional competition. Connecting more departments to the Commercial Data Interchange could significantly reduce loan processing times, addressing a longstanding pain point for SMEs seeking financing .