2024/25 Hong Kong Pre-budget

Unifying talents for prosperity

  • Insight
  • 5 Minute Read
  • 12 Dec 2023

Hong Kong needs to rapidly implement effective policies to bolster the local economy by attracting and retaining talent, with focus on targeted sectors.

As the upcoming 2024/25 Hong Kong Budget announcement on 28 February 2024 by Financial Secretary Paul Chan Mo-po approaches, we present our forecasts and recommendations to the Hong Kong government. With a commitment to making positive and sustained impacts for the economy, business community and individuals, our strategic insights and actionable proposals strive to contribute to the overall growth and prosperity of Hong Kong.

Predictions Our forecasts on Hong Kong's fiscal situation


$110 bn

budget deficit is estimated for 2023/24

PwC expects the HKSAR Government to record a HK$110 billion consolidated budget deficit for the fiscal year 2023/24, based on projected revenue of HK$651 billion and expenditure of HK$761 billion. 


$724.8 bn

fiscal reserves is estimated as at 31 March 2024

PwC estimates fiscal reserves of HK$724.8 billion as at 31 March 2024 – equivalent to around eleven months of total Government expenditure.

Actions Our recommendations

Enhancing Hong Kong's financial services sector

  • To expedite the review of preferential tax regimes for investment funds and carried interest.
  • To modernise the Stamp Duty Ordinance to support financial market development and provide exemptions to market intermediaries.

Attracting quality investments

  • To capitalise on the success of the Office for Attracting Strategic Enterprises (OASES) and quickly follow on with additional measures to anchor more quality investments to Hong Kong.
  • To implement competitive tax and non-tax incentives for regional headquarters in Hong Kong, subject to local spending and employment requirements.
  • To expand Hong Kong’s tax treaty network and address burdens faced by large multinational under global minimum tax rules.

Promoting maritime and aviation industry development

  • To leverage Hong Kong's robust legal and financial systems, well-established infrastructure, and preferential tax regimes to solidify its position as an international maritime centre and global aviation hub.
  • To collaborate with local Chinese mainland government to promote the maritime and aviation industry, aiming for a win-win situation for Chinese mainland and Hong Kong.

Supporting individual taxpayers

  • To review allowances and deductions levels for individual taxpayers coping with rising living costs.
  • To expand tax deduction scope for health insurance premiums to cover private medical schemes beyond VHIS.
  • To introduce tax deductions for private medical expenses incurred by individual taxpayers and their specified dependents.

Insights Hear from our tax professionals

‘In the face of the challenges of fiscal deficits and a declining reserve, the Government needs to act fast to reignite Hong Kong's prosperity. Over the past few years, the Government has already introduced a number of key measures to unify talents and encourage high-quality investments in key sectors. In light of intense economic competition, we need to band together as a team and move forward as one united people to promote these initiatives and shape a brighter future for Hong Kong. Further tax and non-tax incentives to entice skilled professionals to key sectors such as family offices and ESG, incentivise full-time parents to return to the workforce and support employers on employee upskilling should also be considered.’

Charles Lee, Tax Leader, PwC China

‘To bolster Hong Kong's status as a leading hub for family offices, the Government should expand the classes of specified assets eligible for the family office tax concession to cover alternative assets like digital assets, wine, fine arts and collectibles, and relax the restrictions on fixed income from financial instruments to qualify for the tax concession, in order to enhance the competitiveness of the regime. Besides, ensuring alignment between the classes of eligible investment assets under the new Capital Investment Entrant Scheme and the tax concession would create consistency and facilitate operations. Lastly, consider giving Hong Kong residency status to immediate family members of qualified family offices would provide stability and encourage long-term commitment in investment.’

Agnes Wong, PwC Hong Kong Tax Partner

‘The HKSAR Government should prioritise deepening collaboration within the Greater Bay Area (GBA) and friendly tax measures accordingly to foster economic growth and integration. In particular, the HKSAR Government should seize the opportunity to work with relevant authorities in the Chinese mainland in light of the development blueprint for the Hetao Shenzhen-Hong Kong Science and Technology Innovation Cooperation Zone, in fostering the flow of I&T talent and resources, with possibilities of novel tax-efficient structures for conducting R&D activities, and financial incentives and support for Hong Kong talent working in the other GBA cities and vice versa, promoting cross-border talent mobility and knowledge exchange.’

Kenneth Wong, PwC Hong Kong Tax Partner



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Talk to our tax professionals

Charles Lee

Tax Leader, PwC China

+[852] 2289 8899

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Agnes Wong

Partner, PwC Hong Kong

+[852] 2289 3816

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Kenneth Wong

Partner, PwC Hong Kong

+[852] 2289 3822

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Director, PwC Hong Kong

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