Sat, Mar 05, 2011 - Page 12 News List

Ministry of Finance adds exclusionary clauses to tax bill

By Amy Su  /  Staff Reporter

The Ministry of Finance has added exclusionary clauses to the luxury tax draft bill to ensure the tax would not be levied on short-term transactions that do not involve speculation, ministry officials said yesterday.

The ministry held an internal meeting to revise and confirm the draft articles of the bill for what is officially called a “special sales tax,” after taking into account comments by economists and business representatives at a hearing on Thursday.

“The ministry added several additional clauses to exclude people not selling houses for speculative gain,” Deputy Minister of Finance Chang Sheng-ford (張盛和) said after the meeting.

That means people selling their homes because they need to relocate, to release capital or for other legitimate reasons would not need to worry about the new tax, Chang said.

Agricultural land, foreclosed homes and inherited houses would also be excluded, he added.

For those not included in the exclusionary clauses, but still with legitimate reason to sell their property, Chang said the ministry would remain flexible and review each transaction on a case-by-case basis.

The tax would be levied on property bought before the legislation takes effect and sold within two years, with the sale price to be the base. Those who do not report transactions honestly would be punished by a fine of up to three times of the original tax amount.

Chang said the new tax would be good for the nation’s economy in the long term as it would lower speculative investment in the property market and prevent a real estate bubble.

“The tax will also usher in a better business environment for Taiwan’s property market as boosting long-term investment will help the industry prosper in the long term,” Chang said.

Comments will be moderated. Keep comments relevant to the article. Remarks containing abusive and obscene language, personal attacks of any kind or promotion will be removed and the user banned. Final decision will be at the discretion of the Taipei Times.

TOP top