The national treasury managed to rake in more tax revenues than expected last year but may post negative growth this year as the economic downturn was bound to shrink assorted tax incomes, the Ministry of Finance said yesterday.
Tax revenues amounted to NT$1.755 trillion (US$52.96 billion) last year, exceeding the government’s target by NT$14.8 billion on a big increase in income tax from the previous year, the ministry’s report showed.
Income and house taxes gained 14.3 percent and 2.7 percent respectively while securities transactions, commodity, land and other taxes posted two-digit declines last year, the report said.
“It will take a miracle for tax revenues to maintain growth this year,” said Lin Lee-jen (林麗貞), head of the ministry’s statistics department.
“The economic downturn is expected to cut tax revenues across the board,” Lin said.
Securities transactions tax revenues plunged NT$38.3 billion, or 29.9 percent, last year from 2007 while commodity and land levy incomes fell NT$22.5 billion and NT$17.7 billion, or down 15 percent and 23.7 percent respectively.
Like its counterparts abroad, the government is embarking on a campaign of tax cuts and aggressive borrowing to spur economic growth. To that end, it has raised the deduction amounts for income tax and lowered inheritance levies. The NT$500 billion stimulus measure is set to clear the legislature next week.
Liang Kuo-yuan (梁國源), president of Polaris Research Institute (寶華綜合經濟研究院), said borrowing is inevitable in times of recession but suggested the government should channel part of the funds to help develop local green industries to help reduce the nation’s dependence on imported energy.
“The government should not confine the fiscal stimulus to spending programs that promise little help in upgrading local industries,” Liang said by telephone.
“The financial storm reveals the vulnerability of consumer product makers. It is time for the nation to develop other industries,” he said.
Liang, also an advisor with the Council for Economic Planning and Development, said the nation should tap into emerging light-emitting-diode, solar energy and fuel cell markets.
DECOUPLING? In a sign of deeper US-China technology decoupling, Apple has held initial talks about using Baidu’s generative AI technology in its iPhones, the Wall Street Journal said China has introduced guidelines to phase out US microprocessors from Intel Corp and Advanced Micro Devices Inc (AMD) from government PCs and servers, the Financial Times reported yesterday. The procurement guidance also seeks to sideline Microsoft Corp’s Windows operating system and foreign-made database software in favor of domestic options, the report said. Chinese officials have begun following the guidelines, which were unveiled in December last year, the report said. They order government agencies above the township level to include criteria requiring “safe and reliable” processors and operating systems when making purchases, the newspaper said. The US has been aiming to boost domestic semiconductor
Nvidia Corp earned its US$2.2 trillion market cap by producing artificial intelligence (AI) chips that have become the lifeblood powering the new era of generative AI developers from start-ups to Microsoft Corp, OpenAI and Google parent Alphabet Inc. Almost as important to its hardware is the company’s nearly 20 years’ worth of computer code, which helps make competition with the company nearly impossible. More than 4 million global developers rely on Nvidia’s CUDA software platform to build AI and other apps. Now a coalition of tech companies that includes Qualcomm Inc, Google and Intel Corp plans to loosen Nvidia’s chokehold by going
ENERGY IMPACT: The electricity rate hike is expected to add about NT$4 billion to TSMC’s electricity bill a year and cut its annual earnings per share by about NT$0.154 Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) has left its long-term gross margin target unchanged despite the government deciding on Friday to raise electricity rates. One of the heaviest power consuming manufacturers in Taiwan, TSMC said it always respects the government’s energy policy and would continue to operate its fabs by making efforts in energy conservation. The chipmaker said it has left a long-term goal of more than 53 percent in gross margin unchanged. The Ministry of Economic Affairs concluded a power rate evaluation meeting on Friday, announcing electricity tariffs would go up by 11 percent on average to about NT$3.4518 per kilowatt-hour (kWh)
OPENING ADDRESS: The CEO is to give a speech on the future of high-performance computing and artificial intelligence at the trade show’s opening on June 3, TAITRA said Advanced Micro Devices Inc (AMD) chairperson and chief executive officer Lisa Su (蘇姿丰) is to deliver the opening keynote speech at Computex Taipei this year, the event’s organizer said in a statement yesterday. Su is to give a speech on the future of high-performance computing (HPC) in the artificial intelligence (AI) era to open Computex, one of the world’s largest computer and technology trade events, at 9:30am on June 3, the Taiwan External Trade Development Council (TAITRA) said. Su is to explore how AMD and the company’s strategic technology partners are pushing the limits of AI and HPC, from data centers to