Will the Hong Kong’s Economy still be Prosperous in Future?

Written by:HimalayaCT-CPA Jim

Audited by HimalayaCT- Truemanman

The Chinese Communist Party (CCP) enforced National Security Law to intrude judicial independence of Hong Kong preceded by intruding administration, legislature and media, as a result of which personal freedom will be impacted severely while people are the fundamental element of economy.

Immigrating to Hong Kong Wastes Life

CCP in Hong Kong (HKCCP) has been promoting Quality Migrant Admission Scheme (QMAS) and took part in Cooperation events held by the Chinese Institute of Certified Public Accountants (CICPA)and its local associates these years to lure Chinese in mainland (mainlanders), without knowledge of consequences of freedom being gone, into immigrating to Hong Kong. The Hong Kong Institute of Certified Public Accountants as well as accounting profession institute of Taiwan got engaged in Cross-straits, Hong Kong and Macau Accounting Profession Conference (CAMAPC) organized by CCP’s CICPA. Because members of accounting profession are working in many sectors and industries including public sectors, financial institutes, military businesses and media in Hong Kong and Taiwan, there will be disastrous devastation if the members of the profession are unknowledgeable about the essence of CCP totalitarian. As the substance of CAMAPC is BGY i.e. Technical censorship, Gold or money bribery and Sex coercion, accounting frauds in China mainland, such as those committed by Yinguangxia or “China’s Enron”, Qiongminyuan, Lantian Stock, Kangmei Pharmaceutical, Zhangzidao, Greenland, Luckin Coffee and so on, failed to be eliminated fundamentally.

But for a mainlander who wanted to immigrate to Hong Kong to pursue freedom, QMAS is just a junk given the circumstance that Hong Kong’s autonomy being gone and freedom being missing and purpose failing to be served.

Policing Hong Kong’s living onto Mainland’s Way

While touring in Hong Kong, Alipay and WeChat that have been sickened in China mainland were being widely used and there were signs of them all over the around. When checking in at a hostel, it was found that front desk w used junk WeChat rather than WhatsApp to chat with guests and, after my check-in, a public security bureau officer of CCP also checked in this hostel. After examining the cell number bunded to WeChat account of the front desk, it was a phone number registered in Shanghai.

Similar to Shenzhen and Shanghai in China mainland, there is skyrocketed home price irrelevant to local citizen’s income level in Hong Kong. Despite HKCCP’s rising stamp duty rates to curtain property price hiking, such as setting up Buyer’s Stamp Duty at 15% and Special Stamp Duty at not more than 20%, price failed to be curtained fundamentally. The failed measures also can be attributed to no democracy and freedom being gone in Hong Kong. Much money of those trading properties in Hong Kong came from CCP. Because there’s never been an elected government democratically and Hong Kong regime obeyed leadership of CCP tyranny, CCP’s funding resource was not inspected and inefficient anti-money laundering internal control gave green light to dirty money flow resulting in Hong Kong’s significant price jump of properties. Significant economic stake being held by the Hong Kong Dollar’s issuer bank HSBC in mainland made matters worse.

On the other hand, HKCCP signed taxation protocols with mainland to encouraging money laundering in Hong Kong and motivate CCP entities to steal technology and money by making use of special status of Hong Kong. Hong Kong only levied tax on income arising from activities in Hong Kong and didn’t charge tax on global income. There are several tests to decide whether the income is generated in Hong Kong. One of the test is operations test. As pointed out in Smith & Co v Greenwood [(1922) 8 TC 203] by Lord Atkin, ‘the question is, where do the operations take place from which the profits in substance arise?’ The operations test was approved by the Privy Council in CIR v HK-TVB International Ltd [(1992) 1 HKRC 90–064]. It was to ascertain ‘what were the operations which produced the relevant profits and where those operations took place’. CCP entities in Hong Kong were given opportunity to make use of such tests to generate non-taxable income by exporting goods imported from mainland. This would also motivate them to suppress the sales price charged by mainland factories. Those goods were made in mainland but reinvoiced as goods source originated from Hong Kong and sales orders were not enforced in Hong Kong.  Hong Kong was used for promoting exportation and procuring sensitive technology equipment, that was banned by international community for sanctioning CCP for many events including 4 June 1989 Tiananmen Square Slaughter, for usage by CCP.

An arrangement between the mainland of China and the HKCCP for the Avoidance of Double

Taxation and the Prevention of Fiscal Evasion with respect to Taxes on Income (CCP–HK DTA)

was signed between the HKSAR and the Mainland on 21 August 2006. It provided that resident in Hong Kong means: an individual who ordinarily resides in Hong Kong; an individual who stays in Hong Kong for more than 180 days during the relevant year of assessment or for more than 300 days in two consecutive years of assessment (one of which is the relevant year of assessment); a company incorporated in Hong Kong and so forth. This kind of Hong Kong residents can make use of favourable policies in the arrangement to exploit deplorables in mainland China. The definition of resident was included in the picture snipped from the CCP–HK DTA as follows.

According to CCP–HK DTA, where an enterprise of HK carries on business in mainland through a permanent establishment situated therein, there shall in mainland China be attributed to that permanent establishment the profits which it might be expected to make as if it were a distinct and separate enterprise engaged in the same or similar activities under the same or similar conditions and dealing wholly independently with the enterprise of which it is a permanent establishment. As international laws overrule domestic laws in taxation, the suppressed prices mentioned above even not at arm’s length were not subject to adjustment made by mainland tax authorities. Because mainland authorities are reigned by CCP, those benefiting from such provision are actually only limited to CCP senior gangsters associated or CCP entities associated.

CCP–HK DTA also provided that dividends paid by a company which is a resident of mainland to a resident of Hong Kong, may also be taxed in mainland China. Where the beneficial owner in Hong Kong is a company directly owning at least 25% of the capital of the company in mainland which pays the dividends, tax charged shall not exceed 5% of the gross amount of the dividends, in any other case, 10% of the gross amount of the dividends. Where a company which is a resident of Hong Kong derives profits or income from mainland, mainland may not impose any tax on the dividends paid by or undistributed profits of the company even if the dividends paid or the undistributed profits consist wholly or partly of profits or income arising in mainland, except insofar as such dividends paid to a resident of Hong Kong or insofar as the shareholding in respect of which the dividends are paid are effectively connected with a permanent establishment situated in mainland.

The tax rate charged to a mainlander on dividends of unlisted companies is 20%, while the profit tax charged to Hong Kong companies incorporated, computed tax liability of which will be discounted, is 16.5% and tax rate for profit below 2m HKDs is 8.25%. It’s interesting for the tax authority in mainland to translate profit tax in the protocol as gains tax falsely, intentionally or ignorantly, as a result of which the official CCP-HK DTA replaces profit tax with gains tax. Besides the provisions listed above, there are also other favourable provisions  regarding interest, royalties, capital gains, pensions, etc.

Pensions of senior CCP gangsters got exempted from tax

The CCP-HK DTA provided that tax on pensions paid to mainland government officials is only charged in mainland.

Similar provisions are included in both Agreement between the Government of the People’s Republic of China and the Government of the United States of America for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with Respect to Taxes on Income and Agreement between the Government of the People’s Republic of China and the Government of the United Kingdom of Great Britain and Northern Ireland for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with Respect to Taxes on Income and Capital Gains.

And the Individual Income Tax Law passed by the rubble-stamp “People’s Congress” unelected democratically in mainland exempted pensions from tax. Therefore, pensions robbed by CCP state thieves are exempted from tax in mainland, UK and US. Because US and UK set an example for other countries, similar provisions are included in the agreement between CCP and other countries unlisted here one by one.

The companies incorporated in Hong Kong by CCP thieves

CCP entities including Alibaba, Tencent,China Railway Group and Guangshen Group have incorporated subsidiaries or disclose Hong Kong as principal executive offices. Tencent has wired Chinese Yuan of Hong Kong or CNH through WeChat in Hong Kong to pay subscribed capital of a famous company in Guangdong, which indicates that WeChat is a foreign-owned enterprise in accordance with foreign enterprise laws. Despite the facts hereof, WeChat can collect tremendous data of mainlanders, compare the data collected with data in Identify Card System of CCP Public Security Bureau and is designated as favourable or only payment method in public bus stations and railway stations, or only communication software of a CCP’s State Audit Bureau. According to the logic brainwashed by CCP into mainlanders, such circumstances mentioned above harmed national security and leaked state secrets. There are banking receipts of WeChat paying subscribed capital.

A foreign-owned company is not sentenced for criminal offences of harming state security and leaking state secrets, is given greenlight to obtain citizens’ private information, commercial communication content, governmental work communication content and becomes designated payment and communication method. Why? Only one reasonable explanation is that WeChat is actually controlled by CCP criminal organization. It’s worthwhile to mention that in accordance with International Financial Reporting Standards, CCP’s Chinese Accounting Standards for Enterprises or the Hong Kong Financial Reporting Standards, whichever, when judging control of enterprises, one not only looks at the shareholding ratio, but decides whether control is constituted by applying substance over form principle to consider many factors besides shareholding. The following requirement for judging who actually control is slipped from CCP’s Chinese Accounting Standards for Enterprises.

A boss of mainland enterprise told me his company supplied robots to Amazon while it actually supplied goods to Apple. The company’s shares were owned by a business incorporated in Hong Kong by a mainlander. Then where did the technology of making robots come from? Was it procured or stolen making use of the special status of Hong Kong?There was a picture of shareholding of the owner in Hong Kong.

Action!Action!Action!

Hong Kong economy has long become economy of mafia where those including Tencent, Alibaba, Bank of China, Ping An Group and HSBC Bank got engaged in fraudulent activities and money-laundering and thereby Hong Kong became part of organized crimes committed by CCP. For example, CAMAPC enabled accountants working in Hong Kong Exchange, Hong Kong investment bankers and Hong Kong accountancy firms to knowingly turn a blind eye to accounting fraud. Then what supplied the capital water for lake of mafia was recognition of Hong Kong’s status as an international capital market and greed of Wall Street capital, and QE of US Federal Reserve pumped water into this fund lake of CCP organized crime organization. CCP, the coronavirus (CCP virus) pandemic maker and Hong Kong human rights abuser obtained benefit by making use of Hong Kong capital market from the liquidity support of Fed to American capital market to conquer economic trouble brought by CCP virus. In order to let glory be to Hong Kong in future, it’s indispensable to enforce Hong Kong Autonomy Act strictly, decouple USD from HKD, suspend all the double taxation agreements signed with CCP, hold CCP accountable to CCP virus pandemic and American election fraud and wipe out CCP by applying RECO Act.

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