Taiwan’s national debt reached an all-time high of NT$4.29 trillion (US$134 billion) at the end of last year, National Audit Office (NAO) data show, but the Ministry of Finance said that it was because of tax cuts introduced during the global financial crisis.
In a report on the central government’s finances for last year, the NAO said the national debt — including long-term and short-term debt — had grown by NT$1.65 trillion in the past eight years. It would take at least 62 years to repay the debt if there are no new debt or tax cuts, the office said.
Revenue was NT$1.55 trillion last year, while expenditure totaled NT$1.71 trillion, resulting in a deficit of NT$161 billion, the NAO said, adding that it was the first deficit in nearly four years.
Responding to the report, which urged government agencies to review inappropriate tax cuts, Minister of Finance Lee Sush-der (李述德) said on Wednesday night that he respected the suggestions, but the problem was not solely the ministry’s to shoulder.
“Tax reduction measures were not decided solely by the ministry, since they had to go through legal procedures. The ministry shouldn’t be held fully responsible for the debt increase,” Lee said. “The point is not how much debt the government has created, but how the debt is used.”
Proper financing meant the government avoided having to issue NT$100 billion of debt last year, Lee said, adding that he hoped to see more support for the ministry.
The ministry said that the national debt as a percentage of GDP would rise to 38 percent over the next two years. The debt stood at 32.7 percent of GDP at the end of last year.
“It will not exceed the legal maximum of 40 percent. The government’s financial condition is still sound and healthy,” a ministry official said.
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