Hong Kong’s addiction to real estate is hurting long-term growth

Stefano Mariani recently contributed an article to the South China Morning Post discussing how the use of fiscal policy to reduce the attractiveness of property speculation would encourage investment capital to flow into other sectors of Hong Kong’s economy. It would also channel much-needed funds into the knowledge-based economy.

He further commented that the focus of tax reform should not be on raising taxes, but on broadening the tax base. In the longer run, policymakers should look beyond property taxes, and begin to evaluate whether the tax code as a whole warrants ­modernisation. Ideas of interest ­include the introduction of a tax on remitted income or, specifically, ­remitted dividends.

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