The government should unequivocally declare a basic allotment of living space for every citizen. If a citizen's current residence is smaller than this basic living space allotment, then housing and land taxes should be completely waived. If it is greater than this living space allotment, however, housing and land taxes should increase, and the tax rate should increase progressively as the amount of space grows in excess of the basic allotment.
Increased tax revenues can be used for a fund to provide low interest mortgages to people who don't own homes.
When the cost of holding vacant housing units increases, vacant units will be released onto the market more quickly and the supply of housing will increase. When the availability of low interest mortgages increases, demand for housing will increase.
When supply and demand both increase, the real estate market will surely boom.
Simple reform of the housing tax system and the establishment of laws concerning citizens' living space can guarantee basic rights and also gradually mitigate the phenomenon in Taiwan of many housing units remaining vacant while at the same time many people are unable to own a house they can call their own.
Yang Der-yuan is an assistant professor in the business admin-istration department at Chang Jung Christian University.
Translated by Ethan Harkness
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