Lawmakers raised the tax-free annual salary deduction for married couples yesterday from NT$60,000 to NT$88,000 for the current fiscal year, meaning couples whose combined annual income is below the new threshold will not be taxed at all.
The hike is retroactive to Jan. 1, 2005.
"We did this to encourage people to get married and have babies since the nation's fertility rate has been dropping in recent years," Chinese Nationalist Party (KMT) Legislator Alex Fai (
In addition, the amendment to the Income Tax Law (所得稅法) that was passed by the legislature also stipulates that the salary-deduction threshold will be increased and adjusted every year to keep pace with inflation.
The amendment was introduced by Premier Frank Hsieh (
For the 2006 fiscal year, married couples' tax-free annual salary deduction will be increased to NT$92,000.
The salary deduction for single taxpayers will be increased from NT$74,000 to NT$77,000 as well.
The Ministry of Finance said that the amendment will reduce the government's income.
However, it said the measure would not only encourage more people to get married and have children but would help revitalize the economy.
The amendment is expected to benefit approximately 1.25 million couples.
Minister of Finance Lin Chuan (林全) said his rough calculations showed that the government will have at least NT$6 billion (US$179 million) less in tax revenue by the end of 2007 after the new regulations are implemented. He also stressed the measure's benefits to the economy.
In other developments, the legislature moved to help the Ministry of Justice recruit more coroners by passing the Forensic Coroner Law (
At present a person wanting to become a coroner must be a medical school graduate and complete a graduate study course in forensics in order to qualify to take the coroner's exam.
Under the new law, other doctors, dentists and traditional Chinese medicine doctors will be able to become coroners if they pass a one-year coroner training course.