Sat, Apr 14, 2018 - Page 8 News List


Not overcharging for tax

The Tax and Legal Reform League has been very active recently, claiming that the government is illegally levying more taxes than it should and demanding a tax refund for the public. This is a specious claim.

According to articles 59, 60 and 105 of the Constitution, the Executive Yuan shall, before the beginning of each fiscal year, present the budgetary bill for the following fiscal year to the Legislative Yuan. After the end of each fiscal year, it shall present the final accounts of revenues and expenditures to the Control Yuan.

Article 105 also states that the auditor general shall then complete the budget auditing and submit an auditing report to the Legislative Yuan.

The budget includes revenues and expenditures, and the two should be balanced. Estimating tax revenues is part of the estimation of annual revenues. If the tax revenue estimate exceeds actual income, revenues and expenditures will not balance.

To avoid a situation where actual revenues fall below the estimate, the estimate tends to be conservative. As a result, actual tax revenue exceeds budgeted revenue, but this should not be seen as overcharging for tax.

The reason is that the amount of taxes that should be levied during a fiscal year is legally determined, and the government does not have the administrative discretion to increase or reduce taxes at will. In other words, exactly how much tax revenue is to be collected depends on actual economic activities and whether officials levy taxes in accordance with the law.

Over the past few years, Taiwan’s actual tax revenue has been higher than budgeted revenue and the accumulated total surplus has reached hundreds of billions of New Taiwan dollars.

The league has therefore accused the government of taxing people too highly. This is a deliberate misrepresentation that seriously misleads the public. When actual revenue exceeds budgeted revenue, it is just a result of imprecise estimates, not a violation of the law.

After all, the government should levy taxes in accordance with the law, and not based on a budget. Otherwise, would courts not have to encourage people to file lawsuits to make sure that the their budget was met, and would they not have to stop people from filing lawsuits to prevent revenue from exceeding their budgeted revenue?

In the past dozen years, wage earners’ incomes have remained stagnant and even dropped slightly, and it is hard to accept that wages have not increased at the same pace as the whole economy.

However, the problem lies neither in tax regulations nor with tax officials.

If the government were to refund the overpayment of tax to the public, no one would be able to calculate who had paid more than they “legally” should, and if there was a general tax refund, those who do not pay taxes would benefit at someone else’s expense, and that would be even more unreasonable.

Lee Chi-sheng

New Taipei City

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