Gov’t proposal on Hato damaged vehicles subsidy to be voted on

The Executive Council (ExCo) has analyzed the final draft of the proposal which will be send to the Legislative Assembly (AL) in order to support residents affected by Typhoon Hato in August last year.

The proposal to assist residents who have lost or had their vehicles severely damaged in the storm was announced several days after Typhoon Hato, but details of the proposal have only recently been finalized and released.

In a press conference at the government headquarters, ExCo spokesperson Leong Heng Teng said that the proposal differs slightly from initial drafts. “We are extending the period of application to two years after the entry of the law into force,” said Leong. Such a  change resulted from “several opinions heard during this period.”

Another significant change is the government’s decision to allow the bill to be analyzed by the AL, instead of being passed as a matter of urgency (as was initially decided).

On the topic, director of the Financial Services Bureau (DSF) Iong Kong Leong said, “It will follow the normal [legislative] procedure and not the urgent one as we thought it was reasonable to do so since this law has a retroactive application.”

Regarding the expected time frame in which residents who have replaced their vehicles can expect to receive a tax refund, Iong said, “This is a proposal, the final version will depend on the discussion at the AL. At this point we are not sure if this bill will be approved like it is or not. […] After [the law] is into force [the tax refund procedure] won’t take a long time, more or less one month to the restitution of the tax to the taxpayer.”

There is still the matter of what percentage refund taxpayers who have replaced lost or damaged vehicles will receive.

Iong noted, “although minimum limits were established [MOP2,000 for motorcycles and MOP8,000 for automobiles], that doesn’t mean that taxpayers will get that. […] For example, if a resident buys a new motorcycle but the tax payable for this new motorcycle is only MOP1,500, he will receive only that amount as refund [in case he is entitled to the 100 percent refund].”

If the new vehicle acquired by the resident uses “alternative energies,” that is, fuel that is not a petroleum derivate, the maximum rebate is set at 80 percent of tax paid for vehicles less than a year old. The claimable rebate will drop by 10 percent each year for all vehicles up to 10 years old, at which point they are considered obsolete and ineligible for a rebate.

A total of 6,521 vehicles will fall under this rebate. These are vehicles registered for cancellation at the Transport Bureau before September 18 last year, which were damaged beyond repair by the typhoon and associated flooding.

Damaged vehicles that could be repaired by their owners will not receive government support. The DSF director estimated that a total of MOP147 million in taxes might be refunded.