Reducing the securities exchange transaction tax is one option the government is considering to bolster the ailing stock market, but the Cabinet has not finalized the plan because of concerns over its effectiveness, Minister of Finance Lee Sush-der (李述德) said yesterday.
“We can’t rule out any possibility, but I can’t tell you whether we will lower [the tax] or not as it is not final,” Lee said in a telephone interview.
What needed to be taken into consideration, Lee said, was whether reducing the tax, which would require passing an amendment to the Securities and Exchange Act (證券交易法), would take too long at a time when the situation calls for urgent action.
Lee made the remarks in response to reports in the Chinese-language United Daily News and Commercial Times yesterday that Vice Premier Paul Chiu (邱正雄), in charge of drawing up measures to boost the economy, was considering cutting the tax.
Chiu could not be reached for comment yesterday, but his aide did not rebut reports that the Cabinet would seek approval from lawmakers for the cut.
The securities transaction tax on the stock market is 0.3 percent of the transaction price as stipulated in Article 2 of the Securities and Exchange Act.
Chiu convened meetings on Thursday and Friday to work on the economic proposal he will present to Premier Liu Chao-shiuan (劉兆玄) this week, with further meetings expected ahead of the Cabinet meeting on Thursday.
Minister Without Portfolio Chu Yun-peng (朱雲鵬) said in a telephone interview yesterday that the securities transaction tax had not been discussed at the preparatory meetings.
Chinese Nationalist Party (KMT) Legislator Chiu Yi (邱毅) said he had proposed cutting the tax in half yesterday.
“Liu agreed with me on this, which he said would be a miracle cure for the stock market,” Chiu said.
Chiu said Presidential Office Secretary-General Chan Chun-po (詹春柏) also approved of the idea when he discussed it with Chan on Friday, adding that he would urge other KMT legislators to make the same appeal to the government this week.