By Hong Kong Asset & Aviation Finance Team, King & Wood Mallesons
The Hong Kong Government has put forward a proposal to amend its tax laws to establish a dedicated taxregime for aircraft owners/lessors based in Hong Kong and leasing to offshore (including PRC) lessees/airlines (see Timeline / References below) (“Proposed Regime”).
Assuming there are no surprises or drafting issues in the implementing legislation, once implemented, the Proposed Regime is expected to make Hong Kong an attractive jurisdiction for existing lessors to set up or expand operations and for new debt and equity investors to enter the aircraft financing market, particularly as cross border leasing into the PRC is concerned.
Draft legislation is expected to be available in April. KWM will provide further updates as they are available.
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