Hong Kong launches new capital investment entrant scheme, PwC: Hopes to include tax exemptions for virtual assets.

Table of Contents

New Measures and Investment Threshold in Hong Kong: HK$30 Million

The Financial Secretary of the Hong Kong Special Administrative Region, Paul Chan Mo-po, announced that details of a new "Capital Investment Entrant Scheme" will be unveiled by the end of the year, with plans to officially launch and accept applications next year. The new scheme will allow investors to invest in various assets such as stocks, funds, and is also studying asset types that are beneficial for Hong Kong's long-term development.

In addition, Chan mentioned that the new scheme will no longer allow investment in real estate to avoid negative impacts on the local market. It is noteworthy that the investment immigration threshold will be raised to HK$30 million, higher than other regions.

Family Offices and Tax Incentives

In March, the Hong Kong government announced 8 attractive measures for family offices, including tax incentives. PwC Hong Kong expressed that clients have shown strong interest in these measures and hope that they can complement the tax incentive system for family offices.

According to a report, Wang Xiaoyan, Tax Partner at PwC Hong Kong, expressed hopes that the Hong Kong government can expand the asset categories and income eligible for tax incentives. She stated that the investment scope of family offices is broad, and besides traditional assets, they also like to invest in emerging and alternative investment products, such as virtual assets, which are currently not included in the incentive system.

Législate Council member Kenneth Lau suggested expanding the eligible asset categories for tax incentives to attract more family offices to settle in Hong Kong. He also pointed out that Hong Kong should focus on attracting family offices from regions like the Middle East.

Resumption and Challenges of the Investment Immigration Scheme

After an 8-year hiatus, the Hong Kong government has resumed the investment immigration scheme, excluding mainland Chinese individuals and prohibiting investments in real estate.

Wong Chi-wai, Tax Planning Partner at PwC, mentioned that despite the higher investment threshold, Hong Kong's low tax rate and no estate tax policy are expected to still attract high-end clients. However, the effectiveness of attracting asset inflows will depend on political factors and the global landscape. Legislative Council member Kenneth Lau from the technology and innovation sector emphasized that Hong Kong should seize the opportunity to actively attract family offices from the Middle East to enhance its influence in the global wealth management market.