Tue, Oct 14, 2008 - Page 2 News List

TWC confirms paying 5 percent tax on revenue

WATER PROFITS For every NT$100 that the TWC collects from water users, it keeps NT$5. It charges NT$2.9 and NT$3.7 for residents living near landfills and incinerators

By Meggie Lu  /  STAFF REPORTER

The Taiwan Water Corp (TWC), which helps many city and county governments collect garbage processing fees and in turn charges those governments a handling fee, confirmed yesterday that it had started paying a 5 percent sales tax on the revenues from this service last month.

Except for Taipei City, residents across the country have paid their garbage processing fees with their water bills for decades, the Environmental Protection Administration (EPA) said yesterday.

In cities and counties with landfills, people pay NT$2.9 for every unit of water they use. In cities and counties with incinerators, users pay NT$3.7 per unit of water, the EPA’s Department of Waste Management Deputy Director General Chen Chang-yu (陳長裕) said.

For helping city and county governments collect the fees, TWC charges a 5 percent handling fee, meaning that for every NT$100 TWC collects for the governments, it keeps NT$5, Chen said.

However, after a recent review, the Ministry of Finance ruled that TWC needed to pay a 5 percent sales tax on this handling fee, Chen said.

“Since there are some fixed costs TWC would need to pay to help local governments with the collection, the EPA decided that this 5 percent tax [totaling about NT$12 million (US$370,000) per year] should be paid by the cities and counties environmental protection bureaus,” Chen said.

Though the Chinese-language United Daily News yesterday quoted some local governments as saying the 5 percent handling fee charged by TWC was too high — Taipei County Government pays TWC NT$60 million a year in handling fees — the water company said that the handling fees merely covered the labor costs of the service.

Rebutting concerns from some environmental groups, Chen said that the bill for the additional tax burden would “absolutely not be footed by the public.”

With the new system, instead of the local governments receiving NT$95 out of every NT$100 TWC collects, the city and county governments would now get NT$94.75, Chen said.

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