【Hong Kong Plans to Provide Cryptocurrency Tax Relief for Hedge Funds and Super Rich Family Offices】On November 28, it was reported that Hong Kong plans to exempt private equity funds, hedge funds, and super wealthy investors from taxes on returns from cryptocurrency, private credit investments, and other assets. This week, the Hong Kong government stated in a 20-page proposal that taxes are "one of the main considerations" for asset management companies when deciding on a business location, and the government hopes to create a "favorable environment" for them. According to the proposal, the Hong Kong government aims to expand the scope of tax-exempt investments to include private credit, overseas real estate, and carbon emission allowances. The government is currently conducting a six-week consultation on the plan. As this proposal comes out, the competing regions of Hong Kong and Singapore are striving to enhance their status as top offshore financial centers. They have been working to attract billionaires and investors, establishing new low-tax fund structures that enable them to hold substantial amounts of capital. Patrick Yip, Vice Chairman of Deloitte China and International Tax Partner, who specializes in family office business, stated that if implemented, Hong Kong's new tax exemption proposal would provide "certainty" for family offices and investors. "This is an important step to enhance Hong Kong's status as a financial and cryptocurrency trading center," Patrick Yip said. He added that currently, some family offices in Hong Kong allocate as much as about 20% of their portfolios to digital assets, which is "not insignificant." (FT)
