In yet another bid to help limit the impact of the global economic downturn, the Ministry of Finance said yesterday that unemployed individuals and companies facing financial difficulties could postpone paying their income tax for as many as three months this year, regardless of the amount involved.
Cheng Yi-ho (鄭義和), deputy director-general of the ministry’s taxation agency, unveiled the tax deferral plan to the media after a closed-door meeting on the matter earlier yesterday.
“The ministry made the decision to help ease the financial pressure on the unemployed and companies that have suffered heavy losses amid the global financial crisis,” Cheng said.
The ministry set certain conditions for companies and individuals to qualify for the tax deferral.
Firms whose net operating revenues dropped 30 percent in the fourth quarter of last year or from this month until April from a year ago will qualify for a deferral of no more than three months, he said.
Companies can file one application each and must pay the tax before the end of this year, he said.
Preliminary estimates by the ministry showed that at least one-third of the nation’s companies would qualify for the deferral, as more than 200,000 firms have reported 30 percent declines in profit for the second half of last year.
Cheng said individuals with low income or who had lost their jobs could also apply for an income tax deferral of the same duration.
Like their corporate counterparts, individual applicants must pay any tax due by the end of this year, Cheng said, adding that further details would be promulgated next month.
In practice, the deferral would not benefit people living below the poverty line, as they do not pay income tax.
There was no mention of payments by installment, something Minister of Finance Lee Sush-der (李述德) had hinted at over the weekend.
Individuals have to file taxes once a year, in May.