- Fears of a Hong Kong brain drain are increasing after China moved to tax its citizens’ global income, undermining the financial hub’s appeal to thousands of bankers and other white-collar workers from the mainland.
Faced with a tax rate as high as 45% — up from about 15% previously —
Chinese professionals across Hong Kong are considering moving back home to avoid getting squeezed by both the new levy and sky-high living costs in the former British colony, according to interviews with workers and recruiters.
The prospect of an exodus has upended expectations that mainland talent
would help offset any outflow of locals and foreign expatriates from Hong
Kong, many of whom are looking to escape the city’s controversial new
national security legislation.
While questions remain about how broadly Chinese authorities will apply the new tax rules in Hong Kong, professionals of all stripes now have reasons to leave a city that not long ago was viewed as one of the world’s most attractive places to build a career. That risks weighing on Hong Kong’s battered economy and further undermining its status as a premier financial center.