As a boost to its position as an asset-management centre of choice for wealthy international investors, Hong Kong has abolished its estate t...

As a boost to its position as an asset-management centre of choice for wealthy international investors, Hong Kong has abolished its estate tax.

This was levied at up to 15 per cent of the value of any assets held in the jurisdiction, including real estate, stocks and luxury goods on death. The tax's repeal is likely to attract many high net worth investors to relocate assets to Hong Kong, a group that already has been attracted by a policy of no capital-gains tax.

Hong Kong is also playing catch-up with its biggest competitor as a financial hub in Asia, Singapore, which does not impose an estate tax on non-residents.

The repeal is retroactive to July 2005 and is expected to cost the Hong Kong Treasury up to $193 million.

Many mainland Chinese nationals will look to Hong Kong as a safe harbour for their assets after their own estate-tax law comes into force as expected after next year.