Hong Kong’s treasury chief has stonewalled calls for more relief measures to help residents purchase property as legislators approved a tax-cutting bill for buyers of cheaper homes.

Secretary for Financial Services and the Treasury Christopher Hui Ching-yu on Wednesday said the bill would benefit about 37,000 homebuyers by reducing stamp duty payments by up to HK$67,500 (US$8,612).

“The move will cost the government about HK$1.9 billion a year,” he added.

Hui was addressing lawmakers during a Legislative Council debate over the Stamp Duty (Amendment) Bill 2023, which was eventually passed by a show-of-hands vote after a 30-minute discussion.

Secretary for Financial Services and the Treasury Christopher Hui.

Stamp duty is a tax levied on documents that are required to legally record property transactions. The government began imposing a series of increased stamp duties on property in 2010 in a bid to crack down on rampant speculation.

The bill seeks to adjust the calculation of the ad valorem stamp duty for the sale and purchase of both residential and non-residential properties, mostly affecting those valued at up to about HK$10 million.

Under the changes, the stamp duty will be HK$100 for properties costing up to HK$3 million, instead of the previous HK$2 million threshold.

The adjustments came into force by way of negative vetting, meaning lawmakers voted on the bill after it took effect. It was implemented immediately after Financial Secretary Paul Chan Mo-po’s announcement of the measure in his budget speech this year.

Hui said he hoped the changes would help ease the burden on first-time buyers of small and medium-sized flats.

Legislator Louis Loong Hon-biu, who represents the real estate and construction sector, said the government should drop all anti-property speculation measures imposed since 2010.

“The housing market nowadays is totally different from what it was in 2010. The cooling measures only twist the market and affect transactions and sales,” said Loong, who also called for stamp duty rates to be reviewed regularly.

Legislator Kwok Wai-keung from the Federation of Trade Unions also urged authorities to introduce more generous stamp duty cuts.

“Saving HK$67,500 is not that much compared with the down payment on a flat,” he said.

Tony Tse Wai-chuen, who represents the architectural, surveying, planning and landscape sector, called on the government to offer loans to residents buying their first home.

Treasury chief Hui said the government would review the need, fiscal situation and economic outlook when it considered adjusting any tax items during budget preparations every year.

“It is not appropriate for the government to mandate an interval for review of individual tax items,” he said.

The bill follows a slew of eased measures for homebuyers suggested over the past few years.

In his first policy address in October 2022, Chief Executive John Lee Ka-chiu proposed the government would refund the extra stamp duty paid by non-local buyers when they bought a residential property in the city – if they remained in Hong Kong for seven years and obtained permanent residence.