Question 1 Polly Inc., a US company, is planning to set up a branch in Hong Kong to sell certain products of the Polly Group. The goods would be supplied by group companies carrying on business outside Hong Kong and would be sold mainly to customers in the Mainland China. Required: Discuss the potential Profits Tax liabilities of Polly Inc. in respect of the profits made from the sale of the group's products by the branch to be set up in Hong Kong. (Hint: carrying on a business in HK? Source of profits in HK?)