Forvis Mazars on Hong Kong Budget 2025-26

The Financial Secretary of the Hong Kong Special Administrative Region (HKSAR), Mr Paul Chan Mo-po (Mr Chan), delivered the 2025-26 Hong Kong Budget Speech on 26 February 2025. This is the third budget he prepared for the current-term Government led by HKSAR Chief Executive, Mr John Lee Ka-Chiu.

Against the backdrop of unstable international geopolitical situation, escalated trade conflicts and elevated global interest rates which adversely impacted on local economic activities and confidence, Mr Chan expected that there will be a consolidated deficit of HK$87.2 billion for the 2024-25 financial year, almost double the original estimated deficit of HK$48.1 billion in the last year's Budget.  This is primarily due to less-than-expected land related revenue and stamp duty revenue.  As a result of consecutive consolidated deficits, the fiscal reserves of HKSAR are expected to decline to HK$647.3 billion as of 31 March 2025.

Key economic performance and outlook as well as tax changes in the 2025-26 Budget are highlighted in this newsletter. Please view here.