The Legislative Yuan yesterday passed approved a statute governing the development of Taoyuan International Airport Zone, which will create a free trade zone near the airport where businesses will enjoy preferential taxes and fewer labor restrictions.
The statute exempts foreign and domestic businesses that authorize companies in free trade ports to stock inventory or process materials for export from paying business income tax. If companies sell to domestic businesses, then the proportion of income exempt from tax would be 10 percent of the total amount exported.
It also stipulates that Aborigines make up at least 3 percent of the work force in companies in the free trade ports. Foreign labor would be governed by the Employment Services Act (就業服務法) and the Act for the Establishment and Management of Free Ports (自由貿易港區設置管理條例), with the exception that service sectors may not hire foreign labor or workers from China.
Since October, the Ministry of Transportation and Communications has been pushing to exempt the airport zone from labor regulations in local free trade zones — such as a minimum wage, requirements that foreign workers be limited to 40 percent of a company's work force and that Aborigines make up at least 5 percent.
The draft statute comes at a sticky timing when unemployment rates have been climbing to record highs and the number of people on unpaid leave even higher. It has also drawn criticism from labor associations, protesting that more Taiwanese would lose their jobs if the government opens up to more foreign labor.
The Taoyuan International Airport currently employs 8,000 domestic workers, but once the draft statute is passed, foreign workers could take up as much as 40 percent of the work force and 3,200 domestic workers could lose their jobs, said Mao Chen-fei (毛振飛), chairman of the Confederation of Taoyuan Trade Unions.