The Financial Affairs and Budget Bureau has presented a second‑reading proposal for the ‘2026 Tax (Amendment) (Tax Incentive Scheme for Funds, Family Investment Control Tools and Ancillary Rights) Bill’, a legislative instrument designed to broaden tax‑efficient investment avenues for both institutional and retail investors. Central to the bill is a suite of concessions that lower the tax burden on qualifying funds, family‑office structures and ancillary rights linked to inter‑generational wealth planning. Eligibility hinges on compliance with stringent governance standards, transparent reporting of beneficiaries and adherence to prescribed investment limits that prioritise domestic assets. The scheme offers a reduced profits tax rate of 8.25 % for the first HK$10 million of qualifying income, with a stepped increase thereafter, alongside a one‑off exemption on capital gains arising from the disposal of qualifying holdings. The bureau argues that these measures will make Hong Kong more competitive in the region’s wealth‑management landscape, encouraging capital inflows and supporting the development of a deeper domestic fund market. Industry bodies have praised the clarity of the regulatory framework, noting that it reduces uncertainty for fund managers and families seeking tax‑optimal structures. Nonetheless, some analysts caution that the overall revenue impact could be significant and recommend robust audit mechanisms to ensure that only bona‑fide entities benefit from the concessions.