Following a day of heated debate and discussion, the legislature’s Finance Committee yesterday agreed to open five proposals for a capital gains tax on securities investments to cross-party negotiations, down from 10 versions of the plan and 20 proposed amendments.
The five include the original Cabinet-proposed draft, one each drafted by the Chinese Nationalist Party (KMT) caucus, the Democratic Progressive Party (DPP) caucus and the People First Party (PFP) caucus and one by DPP Legislator Hsu Tain-tsair (許添財).
“It was quite significant progress for the committee to condense 20 amendments into five proposals,” KMT Legislator Lu Shiow-yen (盧秀燕), the committee’s convener, told reporters.
The committee started reviewing the 20 amendments at 9am yesterday, with KMT caucus whip Lin Hung-chih (林鴻池), DPP caucus whip Ker Chien-ming (柯建銘) and PFP caucus whip Thomas Lee (李桐豪) attending the meeting. However, major disagreements meant the committee members failed to reach a consensus on any single draft.
After a discussion in the afternoon, the KMT, DPP and PFP whips decided to try to integrate the drafts proposed by their respective parties’ lawmakers into one version, with the committee sending those condensed versions directly for cross-party negotiations.
Following more than three hours of negotiations and discussions between caucuses in an effort to reach a compromise, opposition lawmakers were able to force an intermission and the committee later decided to just put forward the five proposals. Procedural regulations meant the Cabinet’s original draft had to be included in the five.
The PFP caucus kept the original version it proposed, while the DPP sent one drafted by its caucus and one by Hsu because the lawmaker insisted on pushing his own proposal.
The KMT caucus’ final version included amendments based on the Cabinet-proposed draft. The plan negotiated by the Cabinet and the KMT caucus on Thursday last week features a dual-track system from next year to 2014 and a single tax system starting in 2015.
The five proposals suggest a variety of thresholds, tax rates and tax-collection measures. However, Minister of Finance Chang Sheng-ford (張盛和), who took office before yesterday’s meeting, said the results were acceptable.
“At least the amendments were sent out from the Finance Committee,” Chang told reporters.
This was an important step to ease the uncertainty the debate over the tax proposal has caused in the stock market and help the TAIEX return to normal, Chang said.
Chang said he believed the legislature would quickly launch the cross-party negotiations to turn the five versions into one that creates a tax structure for capital gains in securities investments.