Commentary
On 25 February 2026, the Financial Secretary delivered the Hong
Kong SAR Government's (“the Government”) 2026-27
Budget (“the Budget”). Benefiting from a buoyant stock
market and accelerated economic growth, stamp duty and profits tax
revenues were higher than expected, and the Government's
operating account is expected to record a surplus ahead of schedule
in the 2025-26 fiscal year.
Despite substantial expenditure on various capital projects and
a resulting deficit in the capital account, the Financial Secretary
forecasts that, after accounting for the issuance and repayment of
government bonds, the fiscal position for the 2025-26 fiscal year
has improved from the previously estimated budget deficit of HKD 67
billion to a budget surplus of HKD 2.9 billion—the first
surplus recorded since 2021-22. Hong Kong's fiscal reserves
remain relatively healthy and are projected to stand at HKD 657.2
billion as at 31 March 2026.
