Luxury goods makers, including those in the home furnishings and auto businesses, yesterday said the proposed luxury tax “would not have much impact” on sales because their customers are seeking top-quality goods and could afford to pay a little extra.
That contradicts concerns raised by the European Chamber of Commerce Taipei (ECCT) that the tax could hurt car sales.
“Some clients are spending as much as NT$10 million [US$300,000] furnishing their homes. They will not frown on the extra tax,” said David Hsu (徐培庭), marketing director at New World Design Center (紐約家具設計中心).
Photo: Yang Ya-min, Taipei Times
“These customers do not only buy one piece of furniture; they are purchasing many pieces at the same time. That comes out at many zeros [in dollar terms],” he said by phone.
New World Design promotes itself as an operator of top-class furniture malls.
In December, the firm launched a new five-story mall in Neihu, Taipei, that spans 7,000 ping (23,100m2). That complements its three other malls — two in Sinchuang, New Taipei City (新北市), and another in Taichung.
The Neihu mall’s goal is to earn NT$1.4 billion in sales for the first year and that remains intact, Hsu added.
The Ministry of Finance has announced plans to impose a 10 percent luxury tax on the sale of certain expensive goods and services — such as home furnishings that cost NT$500,000 or more, as well as private jets, yachts and cars with a price tag of at least NT$3 million — starting in July at the earliest.
On Wednesday, the ECCT expressed concern over the imposition of a luxury tax on European vehicle importers during an hour-long meeting with Minister of Finance Lee Sush-der (李述德), Central News Agency (CNA) reported, citing ECCT chief executive Freddie Hoeglund and chairman Chris James.
CNA quoted an official at the ministry saying that 3,500 such vehicles were purchased last year and if the tax were imposed, the nation’s tax revenues would be boosted by an additional NT$1.5 billion.
However, the impact could be wider than the ministry’s estimates.
Automakers said that among the 32,000 high-end imported vehicles sold last year, 40 percent — or 13,000 units — were priced at NT$3 million or more.
Mercedes-Benz and BMW would take the biggest hit, said an official from Hotai Motor Co (和泰汽車) who wished to remain anonymous.
Hotai distributes the high-end Lexus models and it sold more than 6,000 cars last year, 500 of them from the LS series — the only model that carries a price tag of more than NT$3 million.
“The impact isn’t that huge to us, but consumer confidence will take a hit. They will wonder why on earth they have to shoulder the extra 10 percent,” he said.
TECH RACE: The Chinese firm showed off its new Mate XT hours after the latest iPhone launch, but its price tag and limited supply could be drawbacks China’s Huawei Technologies Co (華為) yesterday unveiled the world’s first tri-foldable phone, as it seeks to expand its lead in the world’s biggest smartphone market and steal the spotlight from Apple Inc hours after it debuted a new iPhone. The Chinese tech giant showed off its new Mate XT, which users can fold three ways like an accordion screen door, during a launch ceremony in Shenzhen. The Mate XT comes in red and black and has a 10.2-inch display screen. At 3.6mm thick, it is the world’s slimmest foldable smartphone, Huawei said. The company’s Web site showed that it has garnered more than
CROSS-STRAIT TENSIONS: The US company could switch orders from TSMC to alternative suppliers, but that would lower chip quality, CEO Jensen Huang said Nvidia Corp CEO Jensen Huang (黃仁勳), whose products have become the hottest commodity in the technology world, on Wednesday said that the scramble for a limited amount of supply has frustrated some customers and raised tensions. “The demand on it is so great, and everyone wants to be first and everyone wants to be most,” he told the audience at a Goldman Sachs Group Inc technology conference in San Francisco. “We probably have more emotional customers today. Deservedly so. It’s tense. We’re trying to do the best we can.” Huang’s company is experiencing strong demand for its latest generation of chips, called
ISSUES: Gogoro has been struggling with ballooning losses and was recently embroiled in alleged subsidy fraud, using Chinese-made components instead of locally made parts Gogoro Inc (睿能創意), the nation’s biggest electric scooter maker, yesterday said that its chairman and CEO Horace Luke (陸學森) has resigned amid chronic losses and probes into the company’s alleged involvement in subsidy fraud. The board of directors nominated Reuntex Group (潤泰集團) general counsel Tamon Tseng (曾夢達) as the company’s new chairman, Gogoro said in a statement. Ruentex is Gogoro’s biggest stakeholder. Gogoro Taiwan general manager Henry Chiang (姜家煒) is to serve as acting CEO during the interim period, the statement said. Luke’s departure came as a bombshell yesterday. As a company founder, he has played a key role in pushing for the
Vanguard International Semiconductor Corp (世界先進) and Episil Technologies Inc (漢磊) yesterday announced plans to jointly build an 8-inch fab to produce silicon carbide (SiC) chips through an equity acquisition deal. SiC chips offer higher efficiency and lower energy loss than pure silicon chips, and they are able to operate at higher temperatures. They have become crucial to the development of electric vehicles, artificial intelligence data centers, green energy storage and industrial devices. Vanguard, a contract chipmaker focused on making power management chips and driver ICs for displays, is to acquire a 13 percent stake in Episil for NT$2.48 billion (US$77.1 million).
RSS