A move by the Hong Kong Government to provide tax concessions for marine insurers in Hong Kong, first promised in October 2018, is to be introduced to the Legislative Council next week.
Hong Kong chief executive, Carrie Lam informed a gathering of insurers of the latest development during the opening ceremony of the Asian Insurance Forum 2019, yesterday (10 November).
In line with the autumn 2018 policy address, the amendment bill will implement tax relief proposals allowing for a 50% concession on corporate tax usually charged at 16.5%.
In an attempt to boost the presence of insurers and reinsurers in the territory, half rate profits tax concessions have been in place for the reinsurance business of offshore risks of professional reinsurers authorized in Hong Kong since 1998. A similar tax concession has been offered to captives in Hong Kong since 2013.
Later, financial secretary, Paul Chan provided an update on measures introduced to provide Hong Kong insurers and reinsurers with favourable access to the Mainland market. These include a reduction in capital requirements on Mainland insurers when they cede business to qualified Hong Kong reinsurers.
The operating experience requirement for Hong Kong service suppliers looking to provide insurance-loss adjusting services on the Mainland has been removed; and there has been an affirmation of the Central Government’s support for Mainland insurers wishing to issue catastrophe bonds in Hong Kong.
Mr Chan also referred to recent developments under CEPA (Closer Economic Partnership Agreement), which updates the liberalization and facilitation of trade in services.
For the insurance sector, the amendment agreement introduces a number of new measures. They include the removal of specific market-entry requirements for insurance companies and the removal of the maximum shareholding percentage allowed for Hong Kong companies in Mainland insurance companies.
It also relaxes requirements for Hong Kong insurance agencies setting up companies in the Mainland, making it easier for them to tap into the vast Mainland market.
The conference was organized by the Insurance Authority
Source:hongkongmaritimehub
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