Legislative Council
LC Paper No. CB(1) 932/98-99
(These minutes have been seen
by the Administration)
Ref: CB1/BC/5/98
Bills Committee on
Adaptation of Laws (No. 6) Bill 1998
Minutes of meeting held on
Tuesday, 29 December 1998, at 4:30 pm
in Conference Room A of the Legislative Council Building
Members present :
Hon Margaret NG (Chairman)
Hon James TO Kun-sun
Hon SIN Chung-kai
Hon Andrew WONG Wang-fat, JP
Hon Jasper TSANG Yok-sing, JP
Hon Ambrose LAU Hon-chuen, JP
Members absent :
Hon Ronald ARCULLI, JP
Hon Mrs Miriam LAU Kin-yee, JP
Public officers attending :
- Miss Amy TSE
- Deputy Secretary for the Treasury (Acting)
- Miss Vivian SUM
- Assistant Secretary for the Treasury (Revenue)
- Mr Michael CHIK
- Assistant Commissioner of Customs and Excise
- Mr CHU Yum-yuen
- Assistant Commissioner of Inland Revenue (Acting)
- Mr CHAN Pak-ah
- Chief Assessor
Inland Revenue Department
- Mr Byron LEUNG
- Government Counsel (1)
Department of Justice
- Miss Josephine CHUNG
- Government Counsel (2)
Department of Justice
Clerk in attendance :
- Mr Andy LAU
- Chief Assistant Secretary (1)6
Staff in attendance :
- Miss Anita HO
- Assistant Legal Adviser 2
- Mr Daniel HUI
- Senior Assistant Secretary (1)5
I. Meeting with the Administration
(LC Paper No. CB(1)677/98-99(01) - Information paper provided by the Administration)
Matters arising from previous meeting
Members went through the information paper provided by the Administration which set out the Administration's response to members' queries raised at the last meeting held on 3 December 1998. Members sought clarification from the Administration on the following points:
Schedule 2 - Amendment to the definition of "export" under section 2(1) of the Dutiable Commodities Ordinance
2. Mr TSANG Yok-sing enquired whether the terms "any country" and "another country" used in the definition of "export" referred to two different countries. The Government Counsel (1) (GC/1) replied in the affirmative.
3. The Assistant Commissioner of Customs and Excise (AC/C&E) advised that the definition of "export" was divided into two parts. The first part referred to all goods which were carried out of Hong Kong and hence covered a very wide range of situations. The second part of the definition referred expressly to a special situation, i.e. transhipment, which might otherwise be taken as outside the definition of export. The inclusion of this second part did not affect the scope of application of the first part which was general in nature. With the present interpretation of the definition of "export", goods exported to the United Kingdom, the Mainland of China or even Taiwan were all covered by the first part, but not the second part, of the definition.
4. The Deputy Secretary for the Treasury (Acting) (DS for Tsy (Atg)) supplemented that the Administration had reviewed the appropriateness of including the proposed amendments under the adaptation of laws exercise, and considered that whilst the amendments could improve the text of the definition, it might not necessarily be dealt with under the Adaptation of Laws Programme. As such, the Administration would move a Committee Stage amendment (CSA) to delete the proposed amendments from the Bill.
5. The Assistant Legal Adviser 2 pointed out that since references to "foreign place" under the definition of "transit cargo" in the same Ordinance had already been replaced by the term "a place outside Hong Kong", there might be inconsistency in terminology if amendments to the definition of "export" were withdrawn. DS for Tsy (Atg) clarified that the term "foreign place" had to be amended to "a place outside Hong Kong" so as to preserve the original meaning of the term "transit cargo" to cover the Mainland of China. However, with the present interpretation of the definition of "export", goods exported to the Mainland of China would, in any case, be classified as export irrespective of whether the proposed amendments to the definition of "export" were carried or not. Members had no further comments on the Administration's proposal to withdraw the proposed amendments.
(Post meeting note : The draft CSA was circulated to members for comments on 11 January 1999 vide LC Paper No. CB(1) 739/98-99. The Secretariat had not received any further comments from members.)
Schedule 4 - Amendment to section 8(2)(h) of the Inland Revenue Ordinance
6. The Chairman noted that if the proposed adaptation of section 8(2)(h) of the Inland Revenue Ordinance (IRO) were enacted, persons in the temporary service of the Central People's Government working in Hong Kong would be granted salaries tax exemption. She enquired if any persons were currently eligible for such an exemption, and pointed out that if the amended section would not be applicable to any person, adaptation of the section might not be necessary and a simple repeal would suffice. The Assistant Commissioner of Inland Revenue (Acting) (AC/IR (Atg)) and DS for Tsy (Atg) explained that prior to the collection of tax returns, it would not be possible for the Administration to ascertain whether there were any persons eligible for such kind of tax exemption under the amended section 8(2)(h) and the Administration could not rule out such possibility. Moreover, as the tax exemption made available to the United Kingdom Government was a standing arrangement prior to the transfer of sovereignty, the Administration considered that the arrangement should be retained for the Central People's Government. Adaptation of the section had accordingly been proposed.
Schedule 4 - Amendment to the definition of "operator of a Hong Kong aircraft" in section 39E(5) of the IRO
7. GC/1 advised that section 39E(5) of the IRO made a reference to a United Kingdom Order, i.e. the Air Navigation (Overseas Territories) Order 1977. The Administration had proposed to adapt the section to ensure that it would be consistent with Hong Kong's status as a Special Administrative Region of the People's Republic of China. For adaptation of law purposes, GC/1 explained that the references might either be deleted or replaced by an appropriate reference. The former course of action was not recommended as in doing so the operation of the section, which concerned the claiming of allowances for leased machinery and plant by taxpayers (including aircraft operators), would be affected. The Administration had therefore decided to adopt the alternative of replacing it with an appropriate reference. As the United Kingdom Order was localised as the Air Navigation (Hong Kong) Order 1995 (section 11 of the Civil Aviation (Amendment) Ordinance (66 of 1997) which was now the subsidiary legislation of the Civil Aviation Ordinance (Cap. 448), the Administration had proposed to replace the reference to the United Kingdom Order by the "Air Navigation (Hong Kong) Order 1995". Although the proposed amendment could have been taken up in 1995 when the United Kingdom Order was replaced by the Air Navigation (Hong Kong) Order 1995, the amendment still fell within the scope of adaptation of laws as the proposal dealt with the adaptation of an United Kingdom Order which should not be retained in Hong Kong's legislation.
Continuation of the clause-by-clause examination
Schedule 6 - Stamp Duty Ordinance (Cap. 117)
8. Members continued to go through the Bill clause by clause starting from section 10 to Schedule 6 of the Bill. Members noted that the Administration had set out in the information paper the rationale for adapting sections 38 to 47 under Part V of the Stamp Duty Ordinance which concerned exemption and relief. Members had no further questions on the amendments.
Schedule 7 - Air Passenger Departure Tax Ordinance (Cap. 140)
9. The Chairman enquired whether there were any express provision in the Air Passenger Departure Tax Ordinance to bind the State, including the Government of the Hong Kong Special Administrative Region (HKSAR). DS for Tsy (Atg) advised that whilst there was no express provision in this regard, civil servants were required to pay departure tax when they were on official visit.
Schedule 8 - Cross-Harbour Tunnel (Passage Tax) Ordinance (Cap. 274)
10. In reply to the Chairman's question on whether the Ordinance had any binding effect on the State, DS for Tsy (Atg) advised that under the Second Schedule to the Ordinance, a motor vehicle carrying a public officer in the service of the Government who was engaged on duty relating to the tunnel area was exempted from payment of the Cross-Harbour Tunnel Passage Tax.
Schedule 9 - Tax Reserve Certificates Ordinance (Cap. 289)
11. Regarding the adaptation of references to "Governor", members noted that the Administration had adopted the principle that where the reference to the Governor appeared in the context of a power to make subsidiary legislation, the term "Chief Executive in Council" would be used so as to tally with Article 56 of the Basic Law which stipulated, inter alia, that the Chief Executive would consult the Executive Council before making subsidiary legislation; in other cases the term "Chief Executive" would be used. On this basis, the Administration had proposed to replace references to "Governor" in section 3(1) of the Tax Reserve Certificates Ordinance by "Chief Executive in Council".
| 12. Mr Andrew WONG pointed out that in discussing the guiding principles for the Adaptation of Laws Programme at the meetings of the Bills Committees on the Adaptation of Laws Bill 1998 and Adaptation of Laws (No. 2) Bill 1998, he had expressed doubt on the above principles and hence the appropriateness to adapt references to "Governor" as "Chief Executive in Council", having regard to the actual circumstances in the Government. The Chairman also enquired whether amendments to the Tax Reserve Certificates Rules (Cap. 289 sub. leg.) were made by the then Governor under section 3(1) of the Tax Reserve Certificates Ordinance (Cap. 289), and if so whether the Executive Council had been consulted before the amendments were made. DS for Tsy (Atg) undertook to provide further information after the meeting.
| Admin |
(Post meeting note : Additional information was provided by the Administration and circulated to members vide LC Paper No. CB(1) 807/98-99 dated 27 January 1999.)
| 13. In view of the above, members agreed to defer consideration of this issue until the Bills Committees on the Adaptation of Laws Bill 1998 and Adaptation of Laws (No. 2) Bill 1998 had completed deliberations on the general principles adopted in the Adaptation of Laws exercise. The Clerk would keep in view developments and inform members accordingly.
| Clerk |
Schedule 10 - Business Registration Ordinance (Cap. 310)
14. Members had no particular comments on amendments to the Ordinance.
Schedule 11 - Motor Vehicles (First Registration Tax) Ordinance (Cap. 330)
15. The Chairman enquired whether vehicles owned by the Government would be required to pay the motor vehicle first registration tax. DS for Tsy (Atg) advised that motor vehicles owned by the Government were exempted from paying first registration tax under another Ordinance.
Schedule 12 - Hotel Accommodation Tax Ordinance (Cap. 348)
16. Members had no particular comments on amendments to the Ordinance.
Way forward
17. In concluding discussion, the Chairman said that the Bills Committee had basically completed deliberations on the Bill. The Bills Committee was in support of the Bill, subject to the CSA to be moved by the Administration regarding the amendment to the definition of "export" under section 2(1) of the Dutiable Commodities Ordinance, and the final decision on the principles governing the adaptation of references to "Governor" as recommended by the Bills Committees on the Adaptation of Laws Bill 1998 and the Adaptation of Laws (No. 2) Bill 1998.
18. Members also agreed that the Bills Committee would not recommend resumption of Second Reading debate on the Bill until after the Bills Committees on the Adaptation of Laws Bill 1998 and the Adaptation of Laws (No. 2) Bill 1998 had completed deliberations on the Bills concerned.
(Post meeting note : The Chairman had made a verbal report to the House Committee at the meeting on 15 January 1999.)
19. The Chairman advised that it would not be necessary to schedule a further meeting for the time being.
II Any other business
20. There being no other business, the meeting ended at 5:30 pm.
Legislative Council Secretariat
5 March 1999
