The Executive Yuan yesterday approved a draft bill to cut the transaction tax on day trading from 0.003 percent to 0.0015 percent in a bid to stimulate the stock market, which has been hit by low trading volumes.
It is estimated that the measure would cost the government NT$3.75 billion (US$116.24 million) in tax revenue per year, the Ministry of Finance said, but added that an expected jump in the volume of shares traded — taxed at the reduced rate — should cover the loss.
Day trading, which allows traders to buy and sell a stock in a single session — or vice versa — accounts for about 10 percent of total daily trading volumes on the local bourse.
Day trading volume would need to reach NT$10 billion per day to make up for the cost incurred by the tax cut, but taking into account a predicted increase in non-day trading associated with the cut, day trading volume of NT$7.5 billion would be sufficient to cover the cost, the ministry said.
In the most optimistic scenario, in which the knock-on effect of the stimulus measure reaches its maximum potential, the cost of the tax could be recovered if the day trading volume reaches NT$5 billion.
The cut is to be implemented for a trial period of one year, and the Cabinet is to then make a decision on whether to continue the measure depending on trading volumes and tax revenues, Minister of Finance Sheu Yu-jer (許虞哲) said.
The proposed tax cut is expected to clear the legislative floor in an upcoming extraordinary session,
The Chinese Nationalist Party (KMT) also supports the tax cut, although the party’s legislative caucus has criticized the Democratic Progressive Party for attempting to bulldoze a variety of bills in the special session, Sheu said.
The Financial Supervisory Commission has also rolled out a stock market stimulus plan. Investors are now able to buy a fixed New Taiwan dollar amount of stocks and exchange-traded funds (ETFs) on a fixed-term basis, to allow cash redemption of ETFs, in a bid to allow more flexibility for the insurance sector to invest in the stock market and to raise the cap on bank investments in the over-the-counter market.
Taiwan is to receive the first batch of Lockheed Martin F-16 Block 70 jets from the US late this month, a defense official said yesterday, after a year-long delay due to a logjam in US arms deliveries. Completing the NT$247.2 billion (US$7.69 billion) arms deal for 66 jets would make Taiwan the third nation in the world to receive factory-fresh advanced fighter jets of the same make and model, following Bahrain and Slovakia, the official said on condition of anonymity. F-16 Block 70/72 are newly manufactured F-16 jets built by Lockheed Martin to the standards of the F-16V upgrade package. Republic of China
Taiwan-Japan Travel Passes are available for use on public transit networks in the two countries, Taoyuan Metro Corp said yesterday, adding that discounts of up to 7 percent are available. Taoyuan Metro, the Taipei MRT and Japan’s Keisei Electric Railway teamed up to develop the pass. Taoyuan Metro operates the Taiwan Taoyuan International Airport MRT Line, while Keisei Electric Railway offers express services between Tokyo’s Narita Airport, and the Keisei Ueno and Nippori stations in the Japanese capital, as well as between Narita and Haneda airports. The basic package comprises one one-way ticket on the Taoyuan MRT Line and one Skyliner ticket on
Starlux Airlines, Taiwan’s newest international carrier, has announced it would apply to join the Oneworld global airline alliance before the end of next year. In an investor conference on Monday, Starlux Airlines chief executive officer Glenn Chai (翟健華) said joining the alliance would help it access Taiwan. Chai said that if accepted, Starlux would work with other airlines in the alliance on flight schedules, passenger transits and frequent flyer programs. The Oneworld alliance has 13 members, including American Airlines, British Airways, Cathay Pacific and Qantas, and serves more than 900 destinations in 170 territories. Joining Oneworld would also help boost
A new tropical storm formed late yesterday near Guam and is to approach closest to Taiwan on Thursday, the Central Weather Administration (CWA) said. Tropical Storm Pulasan became the 14th named storm of the year at 9:25pm yesterday, the agency said. As of 8am today, it was near Guam traveling northwest at 21kph, it said. The storm’s structure is relatively loose and conditions for strengthening are limited, WeatherRisk analyst Wu Sheng-yu (吳聖宇) said on Facebook. Its path is likely to be similar to Typhoon Bebinca, which passed north of Taiwan over Japan’s Ryukyu Islands and made landfall in Shanghai this morning, he said. However, it