Guiding Principles

58.       Proper disposal of waste entails substantial recurrent expenditure. To alleviate the burden on the community as a whole, we must be guided by the “polluter pays” principle. The experience of some mature economies shows that the most effective way to reduce waste and conserve natural resources is to strictly enforce the “polluter pays” principle. To achieve the desired outcome but also to minimise impact, we may progressively take small, incremental steps to impose charges in light of the prevailing situation.

59.       While upholding the “polluter pays” principle, the Government should provide appropriate incentives in areas necessary to achieve environmental benefits. Many old vehicles are highly polluting and it is in the public interest to accelerate their replacement. In this regard, I propose that the Government spend $3.2 billion to provide an incentive for the early replacement of 74 000 pre-Euro and Euro I diesel commercial vehicles with Euro IV vehicles. We will allow pre-Euro vehicle owners 18 months and Euro I vehicle owners three years to take up the offer. Upon completion of this programme, we envisage that emissions of nitrogen oxide and respirable suspended particulates in Hong Kong will be reduced by 10% and 18% respectively.

60.       We also encourage people to reduce pollution through the use of new technologies. A 30% reduction in first registration tax will be given to people purchasing vehicles with low emissions and high fuel efficiency, subject to a ceiling of $50,000 per vehicle.