INTRODUCTION

This paper presents the Government's proposal to introduce a bill to enable a fee to be charged for the declaration service provided by the Home Affairs Department (HAD) and seeks Members' views on the proposal.

BACKGROUND

2. HAD has been providing declaration service to members of the public free of charge¹ since the 1960s. A number of officers in HAD are appointed Commissioners for Oaths by the Registrar, High Court under delegated authority from the Chief Justice for the purposes of the Oaths and Declarations Ordinance (Cap. 11). The service has been widely used by members of the public. In 1998, some 188,000 declarations were administered at the District Offices of HAD.

3. The declaration service provided by HAD is mostly for private purposes, and is generally sought in connection with declaration of true copies, employment, travel, education and immigration-related matters. Such declarations could also be made through solicitors' firms which normally charge some $200-$500 for their declaration service, depending on the complexity of each case.

4. The issue of charging a fee for the declaration service for private use was brought up by the Director of Audit in his Report No. 24, which was tabled in the Legislative Council on 26 April 1995. The Director of Audit recommended, among other things, that the Secretary for Home Affairs should introduce a fee as early as possible for administering declaration service for private use. In considering the matter, the Public Accounts Committee expressed concern that there could be a potential loss of revenue as a result of the delay in implementing fee charging.

5. Against the above background, the Administration considered the issue of charging a fee for the provision of declaration service and decided that a charging scheme should be introduced to recover the cost of providing the service. The Administration then started to bid for a legislative slot for this purpose.

THE PROPOSAL

6. The objective of the proposal is to enable the Government to charge a fee for the declaration service provided by HAD such that the costs of providing such service can be recovered. The proposal is in line with the "user-pays" principle which ensures that the costs of providing the service are met by individuals who obtain a clear benefit from them, thereby reducing the tax burden borne by the general taxpayer and eliminating any possible subsidy by the general taxpayer.

7. In order to implement the proposal, amendments to the Oaths and Declarations Ordinance (Cap11) are proposed to enable regulations to be made to prescribe the level of fees to be charged by DHA for the declaration service. We will set the fee level having regard to the full cost for providing the declaration service. On the basis of the present caseload, the unit cost of administration is about $50 per declaration, at 1998-99 prices, subject to an up-to-date verification by the Treasury. The fee level to be determined is low when compared with the charge collected by the private sector.

8. A lead time of three months following the enactment of the Bill would be required for the necessary administrative arrangements to be put in place prior to the introduction of fee charging.

FINANCIAL IMPLICATIONS

9. The Home Affairs Department will need to devote additional manpower resources and acquire new equipment to implement the charging proposal. These additional resources will be absorbed within the global allocation of the Secretary for Home Affairs.

10. The projected revenue from charging a fee for the declaration services will be around $9m per annum based on the present caseload.

CURRENT POSITION

11. A legislative slot for introducing an enabling bill to charge a fee for the declaration service has now been allocated for 28 April 1999. The Bill is currently being drafted by the Law Draftsman of the Department of Justice. We intend to finalise the Bill by March 1999.


Home Affairs Bureau
March 1999

1. Prior to 1973, a stamp duty of $3 was levied for each declaration.