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Hong Kong Policy Address 2024 and Budget 2025

Hong Kong Budget 2025 overview as presented to the Legislative Council in Hong Kong on 26 February 2025.

Hong Kong Budget 2025

Hong Kong Policy Address 2024

Summary of the Chief Executive's 2024 Policy Address presented in October 2024

For more information click here: https://www.policyaddress.gov.hk/2024/en/policy.html

Education and Talent

• Launch a new round of Research Matching Grant Scheme, totalling HK$1.5 billion
• Increase annual quota of Hong Kong PhD Fellowship Scheme to 400 places
• Offer 4 000 short-term internship placements in policy bureaux and departments and public organisations in the coming year
• Relax requirements for joining and increase allowance limit of the GBA Youth Employment Scheme
• Organise the second “Global Talent Summit · Hong Kong” next year
• Enhance the New Capital Investment Entrant Scheme

Green Development

• InnoCentre in Kowloon Tong to become hub for GreenTech companies
• HK$300 million subsidy scheme to support installing EV fast chargers
• Provide tax exemptions for green methanol used for bunkering
• Set a Sustainable Aviation Fuel (SAF) consumption target
• HK$470 million for subsidising bus and taxi trades to switch to EVs
• Extend the Pilot Green and Sustainable Finance Capacity Building Support Scheme to 2028

Northern Metropolis

• HK$3.7 billion to expedite Phase 1 facilities of Hong Kong Park of Hetao Co-operation Zone
• Start tendering work for large-scale land disposal
• Complete re-zoning procedures for data facility cluster at Sandy Ridge
• Take forward planning and design of various railway development projects

Land

• About 13,700 units from eight residential sites under the 2025/26 Land Sale Programme and various property developments
• No commercial sites will be put on sale in the coming year
• Make available land for around 80,000 private housing units in the coming five years

Housing 

• Total public housing supply to reach 190,000 units in the coming five years
• Completion of over 17,000 private residential units annually in the coming five years.
• Expected first-hand private residential unit supply around 107,000 for the next three to four years

Caring and Inclusive Community

• Increase number of Residential Care Service Vouchers for the Elderly to 6,000
• Increase No. of Community Care Service Vouchers for the Elderly to 12,000
• Additional annual provision of over HK$180 million to expand residential child care facilities, strengthen support for child abuse victims and their families
• Additional 1,280 day community rehabilitation and home care service places for persons with disabilities
• Regularise the Pilot Project on Enhancing Vocational Rehabilitation Services

Combat Illegal Betting

Explore with HKJC on regulating basketball betting to combat illegal gambling

The following is a topline update on Hong Kong's economic performance and fiscal outlook

Economic Performance in 2024

• GDP growth: 2.5%
• Unemployment rate: 3.1% (latest)
• Headline inflation: 1.7%; underlying inflation 1.1%

Economic Prospects for 2025

• GDP growth forecast: 2% to 3%
• Headline inflation forecast: 1.8%; underlying inflation: 1.5%

Revenue and Expenditure

Total Government Revenue 2025-26: HK$659.4 billion

• Profits tax: HK$192.2billion; Land premium: HK$21billion; Stamp duties: HK$67.6billion; Investment income: HK$51.8billion; Salaries tax: HK$96.5billion; Other revenue: HK$230.3billion

Total Government Expenditure 2025-26: $822.3 billion

• Social welfare: $139.1billion; Health: $141billion; Education: $112.4billion; Infrastructure: $119.3billion; Economic: $61billion; Security: $69billion; Environment and Food: $53.5billion; Others (including community and external affairs): $127billion

• Consolidated deficit forecast 2024-25: HK$87.2 billion
• Forecast consolidated deficit 2025-26: HK$67.0 billion
• Fiscal reserves forecast to be HK$647.4 billion at end-March 2025
• Fiscal reserves forecast to be HK$579.1 billion by end-March 2030

Initiatives

Enhanced fiscal consolidation programme

• Strictly control expenditure, supplemented by increasing revenue
• Maintain competitiveness of low and simple tax regime
• Uphold “user pays” principle

Containing expenditure growth

• Pay freeze for all personnel of executive authorities, civil servants and Members of LegCo, Judiciary and District Councils
• Reduce civil service establishment by 2% each in 2026/27 and 2027/28
• Adjust transport subsidy schemes

Increase revenue

• Raise air passenger departure tax to $200
• Impose application fee and raise visa fee under various talent and capital investor admission schemes
• Review government tolls and fees for road users
• Issue bonds to support expenditure on infrastructure works over next five years

 

Details are available from the budget website: www.budget.gov.hk

Click here to go to KPMG's "Hong Kong Budget Summary 2025 - 2026"