Wage earners get tax relief

An amendment to the Income Tax Law (所得稅法) that would lower the tax bills of the nation's wage earners passed its third reading in the Legislative Yuan yesterday.

Under the changes, workers will be able to take a standard deduction of NT$75,000 on their income taxes, up from NT$62,000 today.

In addition, salary earners will be able to write off up to NT$120,000 in home rental expenses per year. Also, citizens over the age 70 will be allowed to increase their final income tax deduction by 50 percent.

The three new tax measures will be applicable to the 2000 tax year.

Originally, KMT Legislator Chu Li-luan (朱立倫) proposed raising the standard deduction to NT$80,000. But Minister of Finance Yen Ching-chang (顏慶章) and DPP legislators insisted that the amount could only be raised to NT$72,000 without incurring huge losses to the nation's tax coffers.

As a final compromise, the NT$75,000 figure was settled upon. "Although at this time we could not reach the NT$80,000 target, it's a step forward. I am glad that we could complete the changes today," Chu said.

The three measures are expected to cost the government between NT$8 billion and NT$10 billion in lost tax revenue -- though officials haven't said how they plan to make up for the shortfall.

Other tax measures put forth by Chu but did not go forward yesterday include: raising the standard deduction for married taxpayers from NT$60,000 to NT$88,000; allowing up to NT$25,000 in tuition write-offs; and raising the standard deduction for handicapped workers from NT$74,000 to NT$134,000, depending on the degree of the handicap.