Print

Mail

wiki links

Tax law under scrutiny

With consumer prices and oil prices continuing to rise, a Democratic Progressive Party (DPP) legislator is pushing for an amendment to the Income Tax Law (所得稅法) that would alter consumer price index (CPI) calculations and provide tax cuts across the board.

DPP Legislator Yu Jan-daw (余政道) yesterday said his amendment would calculate CPI according to the calendar year to "more honestly and immediately respond" to price hikes in oil and consumer products, particularly those that have occurred this year.

The law currently stipulates that the calculation of the CPI starts in November and ends the following October.

Yu also hopes to amend the law so that exemptions and deduction ceilings are reviewed annually.

According to Article 5 of the Income Tax Law, ceilings for tax exemptions and deductions must be adjusted if the CPI grows by 3 percent since the ceilings were last adjusted.

The last adjustment was made in 2001.

Yu said that by last month the CPI had grown by 4.52 percent since the exemption and deduction ceilings were last adjusted.

If any adjustment is to be made, Yu said, it should correspond to actual changes in CPI.

CEILINGS

Exemptions and deduction ceilings should be increased by 4 percent, for example, if the CPI had increased by 4 percent in the appropriate period, he said.

Yu yesterday also requested that the Ministry of Finance respond to the rising prices of oil and consumer goods.

"Ceilings for income-tax exemptions and deductions must be adjusted in November in response to the growth of the CPI, or it will be unfair," Taxation Agency deputy director Kuo Li-chien (郭禮鈐) said in response to Yu's request.

"If the CPI does not show any sign of substantial decline for the next two months, the adjusted range will be estimated at 3 percent or more," Kuo said.

The amended law would come into force next year if the revisions pass the legislature in the next legislative session.

Yu's draft amendments passed the legislature's Procedural Committee in May.

The Finance Committee will begin reviewing the amendments next month.
This story has been viewed 1637 times.