President Ma Ying-jeou (馬英九) needs to improve his leadership acumen and communication prowess to win public support for major government reforms, the American Chamber of Commerce (AmCham) in Taipei said yesterday.
The call from AmCham came after the Ma administration’s efforts to ease import restrictions on US beef containing residues of ractopamine and introduce a capital gains tax on stock investments encountered stiff opposition from lawmakers and the public alike.
“The road ahead is very tough ... There is no room for indecision or hesitation,” AmCham chairman Bill Wiseman told a media briefing on the release of its annual white paper.
Ma, Premier Sean Chen (陳冲) and the Cabinet need to garner the support of civil servants, lawmakers and the public to reconcile opposing interests in the reform process, Wiseman said.
The beef dispute raises concerns over the administration’s credibility, Wiseman said.
Taiwan signed an agreement with the US in October 2009 to open the door to bone-in beef, ground beef and other products from cattle under 30 months old. However, two months later, the legislature revised the regulations, halting imports of ground beef and internal organs from the US, prompting Washington to accuse Taipei of violating the agreement and suspend talks on the Trade and Investment Framework Agreement (TIFA).
AmCham urged the government to seek a resolution to the dispute over US beef imports, resume TIFA talks and pursue stronger trade and investment ties with the US and other trade partners, including participation in the Trans-Pacific Partnership.
AmCham said it supported the government’s decision to raise electricity rates to encourage conservation, but recommended a restudy of what it called overly ambitious carbon reduction targets and a decision not to extend the lifecycles of existing nuclear power facilities.
“Simultaneously carrying out the two policies means high costs that undercut Taiwan’s competitiveness,” Wiseman said.
He shied away from comments on the capital gains tax plan, but said policy uncertainty would have a negative impact on financial markets and the sectors linked to their performance.
The latest white paper pressed for a more favorable environment for cultivating startup companies and reduction of the withholding tax on foreign entities supplying services and intellectual property to Taiwan.
The paper also suggested restoring the tax exemption on royalties for foreign patents and know-how utilized by Taiwanese companies and increasing incentives for the private sector to engage in research and development.
The proposed tax cuts would help Taiwan overcome the innovation gap that constrains many of the nation’s industrial sectors, Wiseman said.
AmCham also recommended stronger laws against the misappropriation of trade secrets that takes the form of personnel recruitment by rival companies, Wiseman said.
The paper urged the government to end job protectionism, which it said has led to a brain drain and uncompetitive wage levels.
Policymakers should lower personal income tax rates to help attract foreign talent and streamline immigration procedures for bringing Chinese professionals and qualified hospitality industry workers to Taiwan, Wiseman said.