Hong Kong Financial Secretary Henry Tang is expected to leave taxes and fees frozen when he presents a "market friendly" maiden budget speech this week, analysts say.
Tang is expected to target a balanced budget within the next five years, helped by the tough policies of his predecessor, Antony Leung, who was forced to stand down in July last year, according to Citigroup.
"Unlike his predecessor, we think Tang is lucky that he does not need to announce unpopular tax hikes to cut the fiscal deficit," said Yiping Huang, Citigroup analyst in Hong Kong.
The city's budget deficit has fallen sharply in the past year thanks to a strong economic recovery and rapidly improving stock and property markets, as well as the tough measures made by Leung, Huang said.
