The Hong Kong Inland Revenue Department has announced the approval of the Inland Revenue (Amendment) (Taxation on Foreign-sourced Disposal Gains) Bill 2023, which includes amendments to refine Hong Kong's new foreign-sourced income exemption (FSIE) regime. The new FSIE regime, which entered into force on 1 January 2023, allows tax exemptions for specified foreign-sourced passive income received in Hong Kong by relevant MNE entities provided that certain exemption conditions are met, including economic substance requirements. With respect to capital gains, the FSIE regime currently applies for foreign-sourced disposal gains in relation to shares or equity interests. This is expanded by the...