Here is how you and businesses will benefit from Hong Kong budget sweeteners hike
South China Morning Post
by Edith LinFebruary 25, 2026
AI-Generated Deep Dive Summary
Hong Kong authorities have announced a significant increase in financial relief measures, offering sweeteners worth approximately HK$22 billion (US$2.8 billion) to residents and businesses, marking a substantial rise from last year’s allocation of HK$7.8 billion. This move comes as the region’s public finances are expected to shift from a deficit to a surplus, with officials aiming to support both individuals and small-to-medium-sized enterprises (SMEs) while maintaining financial prudence.
The Financial Secretary, Paul Chan Mo-po, revealed these plans during his annual budget address, highlighting that while Hong Kong’s economy is stable, there remain challenges for residents and businesses navigating economic transformation. The relief package includes a 100% reduction in profit tax, salaries tax, and tax under personal assessment for the 2025–26 assessment year, with the ceiling doubled to HK$3,000. This reflects the government’s commitment to alleviating financial burdens on those facing difficulties amid ongoing economic changes.
The announcement also underscores Hong Kong’s improving public finances, with a projected consolidated surplus for the financial years 2025-26 and 2026-27, despite a capital account deficit. By leveraging this surplus, the government aims to provide targeted support to those in need while ensuring long-term fiscal sustainability. This approach not only addresses immediate challenges but also signals Hong Kong’s ability to adapt and thrive as a global financial hub, offering lessons for other regions grappling with economic transitions.
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Originally published on South China Morning Post on 2/25/2026