Tax Concessions and Incentive Schemes

Green and Sustainable Finance Grant Scheme

Launched in May 2021, the Green and Sustainable Finance Grant Scheme (GSF Grant Scheme) provides subsidy for the costs of eligible green and sustainable bond and loan issuances in Hong Kong.

The Financial Secretary proposed in the 2024-25 Budget to extend the GSF Grant Scheme by three years to 2027, and expand the scope of subsidies to cover transition bonds and loans with a view to encouraging relevant industries in the region to make use of Hong Kong’s transition financing platform as they move towards decarbonisation. The HKMA will continue to administer the GSF Grant Scheme.

The updated Guideline on the GSF Grant Scheme (Updated Guideline) will be effective upon the extension of the scheme on 10 May 2024. The HKMA will keep in view market developments and industry feedback, and may adjust the design of the GSF Grant Scheme, such as eligibility criteria, eligible expenses, grant amounts and application process, etc., from time to time as needed.

For grant applications involving bonds and loans issued before 10 May 2024, please refer to the previous Guideline.

Qualifying Debt Instrument Scheme

Hong Kong’s Qualifying Debt Instrument (QDI) scheme was introduced in 1996 with the objectives of attracting overseas issuers to Hong Kong, enlarging the local debt market, and enhancing the competitiveness of Hong Kong. The scheme provides concessionary tax treatment on interest income and trading profits derived from QDIs.

For more information, please visit the website of the Inland Revenue Department.

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Credit rating requirement

Pursuant to section 14A of the Inland Revenue Ordinance (Cap. 112), to be eligible for the QDI scheme, a debt instrument should, among other criteria, possess a credit rating acceptable to the Monetary Authority (MA) from a rating agency recognised by the MA. For the sole purpose of the QDI scheme, the minimum credit ratings acceptable to the MA are as follows:

Recognised credit rating agencies (in alphabetical order)	Minimum rating required
	*Long-term* *debt instrument*	*Short-term* *debt instrument*
China Chengxin (Asia Pacific) Credit Ratings Company Limited	BBBg-	Ag-3
Fitch Ratings	BBB-	F3
Moody’s Investors Service	Baa3	P-3
Rating and Investment Information, Inc.	BBB-	a-3
S&P Global Ratings	BBB-	A-3

The MA reserves the right to make adjustments to the above list of recognised credit rating agencies and minimum credit ratings required.

The list of recognised credit rating agencies above is for the sole purpose of the QDI scheme, and does not constitute any endorsement, recommendation or advice by the HKMA of any credit rating agencies or any credit ratings assigned by them.

Related Information

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Last revision date : 18 June 2024