Incoming minister of finance Lee Sush-der(李述德) said that the new government may delay the planned taxation on overseas earnings, which is part of the alternative minimum tax (AMT) system, local media reported yesterday.
Lee told the Chinese-language Economic Daily News and Commercial Times that the new taxes at a 20 percent rate — which will be levied on more than NT$1 million in taxpayers’ overseas incomes from next year — will be delayed for at least another year.
The new AMT system was approved in 2005 during former minister of finance Lin Chuan’s (林全) term.
It was launched the following year with the taxation on overseas earnings scheduled to take effect next year.
Lee said that the incoming government will re-evaluate public opinions on the AMT system to facilitate the next stage of tax reform by considering taxation fairness, social justice and economic development.
Wang Wanli (王萬里), head of research at HSBC Securities (Taiwan) Co (匯豐證券) said the new taxes on overseas earnings will scare away high-income earners, who may park their assets in places such as Singapore and Hong Kong where tax rates are lower, local media reports said.
“The new taxes do not reflect the new government’s plan to encourage a repatriation of capital flight,” the Economic Daily News quoted Wang as saying.