HONG KONG, March 5: Hong Kong’s government on Wednesday announced sweeping tax hikes to help the territory bring a ballooning budget deficit under control.

Financial secretary Antony Leung said the hikes announced in the budget would raise US$1.80 billion and more measures to raise another six billion dollars would be announced over the next three years.

Leung said the deficit for the current year to March could be as high as US$8.99 billion, or 5.5 per cent of GDP.

This is up from $63.3 billion last year and some $24.8 billion more than the original estimate of $45.2 billion.

However, the new measures would help the government reduce the deficit slightly to 67.9 billion in the year to March 2004. The government aims to bring the budget back into surplus by the year to March 2007.

Hong Kong has struggled to recover from the Asian financial crisis of 1997, suffering two recessions since.—AFP