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Industry group presents economic demands

“Fundamentally, we believe that lower taxes will always help boost the local economy’s competitiveness and could expand the sources of tax revenues for the government.” — Preston Chen, chairman of the Chinese National Federation of Industries

The Chinese National Federation of Industries (CNFI, 工業總會) yesterday released its 2009 white paper, urging the government to address 244 economic issues that include offering a competitive tax environment, cheaper labor and lower energy prices.

Federation chairman Preston Chen (陳武雄) threw his support behind the government’s plan to further develop nuclear power to lower the nation’s electricity costs, while vice chairman Rock Hsu (許勝雄) told reporters that the government should “freeze” electricity prices during this economic slowdown.

The business group, which represents 151 domestic industries, said that the alternative minimum tax scheme, which was introduced in 2006, should be scrapped, while the top bracket for individual income taxes should be halved to 20 percent after the legislature approved a measure to cut the top bracket for business income taxes to 20 percent in two years from the current 25 percent.

“Fundamentally, we believe that lower taxes will always help boost the local economy’s competitiveness and could expand the sources of tax revenues for the government,” Chen told a media briefing.

Chen expressed satisfaction with the efforts of President Ma Ying-jeou’s (馬英九) administration to solve 58 percent of the group’s 211 recommended economic measures in the first white paper it released in June last year.

“We’re particularly impressed with the government’s progress in cross-strait trade relations,” he said, adding that the planned inking of an economic cooperation framework agreement (ECFA) between Taiwan and China should be accelerated.

The group, however, suggested the government should further relax the 30 percent cap on Chinese shareholders’ stakes in local companies to 50 percent, and voiced hope that Taipei and Beijing could join hands in becoming standards-setters in the region to help them expand into global markets.

The Bureau of Standards, Metrology and Inspection should thus be promoted to a Cabinet-level agency, Hsu said.

He said Taiwan should focus on turning itself into a regional hub for R&D, operations, capital raising and transshipment to facilitate its shift from a manufacturing-oriented economy into a services-based one.

The business group also urged the government to scrap the minimum wage, while calling for increased recruitment of foreign workers. CNFI secretary-general Tsai Lien-sheng (蔡練生) said that many companies had said they had difficulty recruiting workers for labor-intensive jobs.

The group also urged the government to nurture the nation’s small and medium-sized enterprises (SMEs) by allocating 4 percent of the public budget, or NT$85 billion (US$2.5 billion), up from approximately NT$30 billion now, for use as guaranteed loans.

The group will soon present its white paper to the president and the premier.
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