Not-for-profit news site HKFP reports on its own experience of an audit by the HK Inland Revenue Dept of independent media outlets…
The tax office has closed a 20-month investigation into seven years’ worth of HKFP’s accounts, after the newspaper was “randomly selected” for an audit.
The Inland Revenue Department (IRD) claimed an alleged tax underpayment of HK$3,020 during the 2021-22 assessment year, worth 0.78 per cent of HKFP’s income.
Last month, HKFP chose to settle the case and pay HK$57,692, including penalties, to avoid the likely prohibitive cost of further disputing a modest discrepancy. It is unclear how much the case cost taxpayers.
Last February, the IRD launched an audit of HKFP’s corporate accounts and the personal accounts of its founder, Tom Grundy, from 2017 onwards. The Hong Kong Journalists Association revealed this May that much of Hong Kong’s independent news sector – including companies, staff and family members – was also under audit, with some facing “strange, unreasonable claims” from the IRD.
In July, it emerged that many in the independent book sector were also being audited.
…The IRD arrived at the HK$57,381 settlement by applying the 0.78 per cent shortfall during the 2021-22 tax year to HKFP’s declared income during the six other years of inspection. The sum of HK$24,381 was added to a HK$33,000 penalty, plus interest of HK$311.
Within weeks of the IRD probe, accounting firm Noble Partners dropped HKFP as a client, claiming they did not “possess the required knowledge and experience” to handle an audit.
More in this statement from HKFP, including an appeal for donations.
Meanwhile (from a post by razvenhk)…
Pro-democracy Thai restaurant Thai Ki Lung in Sham Shui Po, Hong Kong announced that they have decided to close after 12 Nov, citing a worsening business environment and constant visits from government departments.
What is it about “dictatorship” that people are having a hard time understanding?
Is there anything in the CCP’s track record that led anyone to believe that this time is going to be different?
Well, it can’t possibly be the selective & vindictive persecution of publishers because Hong Kong is a free society & freedom of speech is protected. Because it is a world city etc
You see, HKFP admitted their wrongdoing and paid the outstanding tax, fees and fines. So this audit was fully justified to maintain HKs financial health.
And now pass me the bucket….,..
They learnt this from that Singaporean, Lee Kum Kee, or whatever his name was. Harass them, bankrupt them – „All according to the law“
Randomness with Chinese characteristics.
Is it standard practice to calculate penalties in this manner?
If the audit unearthed an underpayment in just one of the 7 years assessed, why was the shortfall then applied to the years where no discrepancy was found when totting up the fine?
“You see, HKFP admitted their wrongdoing and paid the outstanding tax, fees and fines.”
Did they, in fact, “admit” anything? Seems like they just paid the petty, mafia-like visit to the business “tax” and moved on. Until the NEXT audit.
“It’d be a shame if your nice news organization caught fire one day….”