Premier Chang Chun-hsiung (
According to Lin Chuan (林全), Director General of Budget, Accounting and Statistics, if the securities transaction tax is suspended for one year, central government tax revenues would fall by NT$82.2 billion in 2002, based on current government budget plans.
If the land transaction tax is cut in half, the government will lose tens of billions in revenue. Unless there are measures taken to generate new sources of revenue, it's not feasible to cut the two taxes, said Lin.
Following Chang's comments, President Chen Shui-bian's (陳水扁) blue-ribbon Economic Development Advisory Conference's (EDAC) finance panel passed the proposal to cut or cancel the commodity tax and -- to make up for the shortfall -- and raise the business tax (營業稅). The business tax is automatically added to the price of all goods and services sold in Taiwan.
Tax cuts were a controversial topic even before the EDAC took up the issue.
Following Wednesday's meeting of the EDAC's finance panel -- which previously proposed temporarily cutting the securities transaction and land transaction taxes -- the investment panel made another proposal to cut the commodity tax (貨物稅) on Thursday.
But whether the administration will accept any of these tax-cut proposals has been strongly questioned by government officials. Pundits said there should be a comprehensive study on tax reform before any tax-cut measure can be accepted.
The commodity tax proposal was made by Minister of Economic Affairs Lin Hsin-yi (
According to the Ministry of Finance, commodity tax cuts would take NT$78 billion out of the government's coffers annually.
The panel's proposal to increase the business tax -- currently at 5 percent -- could increase tax revenues by about NT$40 billion a year for each 1 percent increase according to the finance ministry.
With a two percentage point hike of the business tax, a total of NT$80 billion could be increased, or roughly displacing proposed commodity tax cuts.
The legal ceiling for the business tax is currently 10 percent.
"What the government needs to do immediately is to conduct a comprehensive tax reform review, instead of discussing individual tax [measures]," said Sun Ke-nan (孫克難), a research fellow of Chung-hua Institution for Economic Research, who is a conference participant.
"Currently the proposals to cut land and securities taxes are more apt to decrease the tax burden on the rich. The consequence is that if these tax-cut measures are accepted by the administration, the tax burden of this country would fall mostly on salary-earners and the poor," he said.
RETHINK? The defense ministry and Navy Command Headquarters could take over the indigenous submarine project and change its production timeline, a source said Admiral Huang Shu-kuang’s (黃曙光) resignation as head of the Indigenous Submarine Program and as a member of the National Security Council could affect the production of submarines, a source said yesterday. Huang in a statement last night said he had decided to resign due to national security concerns while expressing the hope that it would put a stop to political wrangling that only undermines the advancement of the nation’s defense capabilities. Taiwan People’s Party Legislator Vivian Huang (黃珊珊) yesterday said that the admiral, her older brother, felt it was time for him to step down and that he had completed what he
Taiwan has experienced its most significant improvement in the QS World University Rankings by Subject, data provided on Sunday by international higher education analyst Quacquarelli Symonds (QS) showed. Compared with last year’s edition of the rankings, which measure academic excellence and influence, Taiwanese universities made great improvements in the H Index metric, which evaluates research productivity and its impact, with a notable 30 percent increase overall, QS said. Taiwanese universities also made notable progress in the Citations per Paper metric, which measures the impact of research, achieving a 13 percent increase. Taiwanese universities gained 10 percent in Academic Reputation, but declined 18 percent
CHINA REACTS: The patrol and reconnaissance plane ‘transited the Taiwan Strait in international airspace,’ the 7th Fleet said, while Taipei said it saw nothing unusual The US 7th Fleet yesterday said that a US Navy P-8A Poseidon flew through the Taiwan Strait, a day after US and Chinese defense heads held their first talks since November 2022 in an effort to reduce regional tensions. The patrol and reconnaissance plane “transited the Taiwan Strait in international airspace,” the 7th Fleet said in a news release. “By operating within the Taiwan Strait in accordance with international law, the United States upholds the navigational rights and freedoms of all nations.” In a separate statement, the Ministry of National Defense said that it monitored nearby waters and airspace as the aircraft
UNDER DISCUSSION: The combatant command would integrate fast attack boat and anti-ship missile groups to defend waters closest to the coastline, a source said The military could establish a new combatant command as early as 2026, which would be tasked with defending Taiwan’s territorial waters 24 nautical miles (44.4km) from the nation’s coastline, a source familiar with the matter said yesterday. The new command, which would fall under the Naval Command Headquarters, would be led by a vice admiral and integrate existing fast attack boat and anti-ship missile groups, along with the Naval Maritime Surveillance and Reconnaissance Command, said the source, who asked to remain anonymous. It could be launched by 2026, but details are being discussed and no final timetable has been announced, the source