The Alliance for Fair Tax Reform (AFTR) yesterday slammed a recent TV commercial claiming that lower tax rates correlate with a strong economy, and challenged the anonymous advertiser to a public debate.
In recent weeks a repeatedly aired TV commercial has sent the message that the lower the tax rate, the better the economy and the lower the unemployment rate.
The commercial cites the US economy under former president Ronald Reagan’s administration as an example to support their claim on the relationship between the economy and tax rates.
It also says that Hong Kong and Singapore are more economically developed and people there have more purchasing power than Taiwanese because of lower tax rates.
“Economic development in a country is affected by multiple factors, and there is no absolute direct connection between economic development and the tax rate,” Huang Shih-hsin (黃世鑫), a public finance professor at National Taipei University, told a press conference in Taipei yesterday.
“How good is the economy in tax-free paradises such as the British Virgin Islands or the Cayman Islands?” Huang asked. “People register their companies at these places just to avoid taxes, but they usually don’t make any actual investment.”
On the other hand, in high tax countries such as Sweden, “the economy performs quite well, the social welfare system is great and the quality of life there is high,” he said.
Chien Hsi-chieh, spokesman for the alliance, pointed out that the commercial is not telling the full story.
“[Former US presidents Ronald] Reagan and [George] Bush wanted to boost the economy by cutting taxes — it did work at first, but caused a bigger gap between the rich and the poor,” Chien said.
“In the end, the US government became severely indebted, and the unemployment rate went up to 12 percent under the [George] Bush administration,” he said.
The issue only improved a little after Bill Clinton increased taxes, he said.
Chien went on to say that Hong Kong and Singapore were able to keep low tax rates because they were city-states.
“They don’t spend money on agriculture or national defense,” he said. “And in fact, while the tax rate in Taiwan is 40 percent, the real tax rate is only 13 percent after exemptions for businesses, which is already lower than the 17 percent tax rates in Hong Kong and Singapore.”
Chien said he believed further tax cuts may lower the tax rate to below 10 percent.
“While [President] Ma Ying-jeou [馬英九] has so many projects planned, how will the government get the money?” AFTR convener Wang Jung-chang (王榮璋) said.
Wang suspected that business groups lobbying for reductions in inheritance, gift and business taxes were behind the commercial.
“So this is really a tax cut campaign for the rich, but they’re brainwashing the public to join their campaign,” Wang said.
The Executive Yuan yesterday announced that registration for a one-time universal NT$10,000 cash handout to help people in Taiwan survive US tariffs and inflation would start on Nov. 5, with payouts available as early as Nov. 12. Who is eligible for the handout? Registered Taiwanese nationals are eligible, including those born in Taiwan before April 30 next year with a birth certificate. Non-registered nationals with residence permits, foreign permanent residents and foreign spouses of Taiwanese citizens with residence permits also qualify for the handouts. For people who meet the eligibility requirements, but passed away between yesterday and April 30 next year, surviving family members
The German city of Hamburg on Oct. 14 named a bridge “Kaohsiung-Brucke” after the Taiwanese city of Kaohsiung. The footbridge, formerly known as F566, is to the east of the Speicherstadt, the world’s largest warehouse district, and connects the Dar-es-Salaam-Platz to the Brooktorpromenade near the Port of Hamburg on the Elbe River. Timo Fischer, a Free Democratic Party member of the Hamburg-Mitte District Assembly, in May last year proposed the name change with support from members of the Social Democratic Party and the Christian Democratic Union. Kaohsiung and Hamburg in 1999 inked a sister city agreement, but despite more than a quarter-century of
Taiwanese officials are courting podcasters and influencers aligned with US President Donald Trump as they grow more worried the US leader could undermine Taiwanese interests in talks with China, people familiar with the matter said. Trump has said Taiwan would likely be on the agenda when he is expected to meet Chinese President Xi Jinping (習近平) next week in a bid to resolve persistent trade tensions. China has asked the White House to officially declare it “opposes” Taiwanese independence, Bloomberg reported last month, a concession that would mark a major diplomatic win for Beijing. President William Lai (賴清德) and his top officials
‘ONE CHINA’: A statement that Berlin decides its own China policy did not seem to sit well with Beijing, which offered only one meeting with the German official German Minister for Foreign Affairs Johann Wadephul’s trip to China has been canceled, a spokesperson for his ministry said yesterday, amid rising tensions between the two nations, including over Taiwan. Wadephul had planned to address Chinese curbs on rare earths during his visit, but his comments about Berlin deciding on the “design” of its “one China” policy ahead of the trip appear to have rankled China. Asked about Wadephul’s comments, Chinese Ministry of Foreign Affairs spokesman Guo Jiakun (郭嘉昆) said the “one China principle” has “no room for any self-definition.” In the interview published on Thursday, Wadephul said he would urge China to
RSS