Minister of Finance Chang Sheng-ford (張盛和) may find it challenging to implement the government’s proposed revisions to the capital gains tax on securities investments if he refuses to apologize for the “wrong decision” he made in bringing in the tax last year.
Chang yesterday called for the swift passage of an amendment to the Income Tax Act (所得稅法) ahead of its legislative review this week.
The revised bill proposed by the Chinese Nationalist Party (KMT) was approved by the legislature’s Finance Committee last week, after the committee launched a task force earlier this month to review the tax.
Under the revised bill, the 8,500-point threshold that automatically triggers imposition of the tax for most individual investors would be scrapped, while individual investors who sell NT$1 billion (US$33.49 million) worth of shares within a calendar year will be subject to either a 15 percent tax on their capital gains, or a 0.1 percent tax rate on stock trades that exceed NT$1 billion.
The changes would be effective from 2015.
Democratic Progressive Party (DPP) Legislator Hsu Tain-tsair (許添財) yesterday asked Chang to apologize to the public for bringing in the capital gains tax last year.
“Without an apology, it will be hard [for the DPP] to be willing to consult [with the KMT] on the amendment,” Hsu told Chang as legislators from the Finance Committee visited the ministry’s Fiscal Information Agency for an inspection yesterday.
It has been the second time that Hsu has asked Chang to apologize over the tax issue.
Chang said the ministry has been communicating with both DPP and People First Party lawmakers over the past week to push forward the tax revision, although he admitted to not yet getting positive responses from many of them.
However, the ministry will continue its efforts, Chang said, adding that the revised measures have received positive responses from the public, evidence that the proposed new rules are an improvement on the current ones.
If the legislative caucuses fail to reach a consensus by the end of the month, review of the bill may be postponed for a month, according to KMT Legislator Alex Fai (費鴻泰), one of the Finance Committee conveners.