KPMG on Tuesday called on the government to abolish all property cooling measures, undertake a comprehensive review of the tax base system and provide more tax incentives for research and development activities.

These are some of the accounting firm's suggestions for the upcoming budget, which will be delivered by Financial Secretary Paul Chan on Wednesday next week.

It estimates that the government will run a deficit of HK$130 billion and that its fiscal reserves will fall to around HK$700 billion by the end of March amid falling land sales and stamp duty revenues.

John Timpany, KPMG's head of tax in Hong Kong, said he believed more people would invest in property if the cost of buying was reduced.

"I think we need to remember that Hong Kong markets are more than mainland driven, in my mind, the key driver in the Hong Kong residential market has actually been local investment in local properties," he said.

"If the government can make it easier for people to invest, and have a stake in the future of Hong Kong, I think they should do it."