Taipei Times (TT): The widening wealth gap has been receiving a lot of attention lately and many people have high expectations that tax reform could help improve this problem. How do you view this?
Christina Liu (劉憶如): Taxation is definitely an important tool to help lower a nation’s income disparity. Based on the current tax laws, the Ministry of Finance will continue to strengthen its tax collection mandate, while examining if anything in the current tax code should be revised to move it more in line with the principles of social justice and fairness.
President Ma Ying-jeou (馬英九) has discussed adopting an “ability-to-pay” principle and the ministry will follow this direction, and discuss it and any related issues in the near future in a Cabinet-based task force on financial integrity.
Photo: Chien Jung-fong, Taipei Times
TT: Does this mean you might consider levying a windfall tax, which you mentioned earlier this month? Also, since the common understanding of a windfall tax is one levied on industries recording above-average profits, what industries might you consider imposing it on in Taiwan?
Liu: We will definitely include the issue for discussion in the task force’s agenda if the public expresses a strong interest in it.
However, at this moment, it seems like the imposition of a windfall tax will not be the primary issue discussed, meaning it might not be addressed during the first round of task force meetings.
Basically, a windfall tax would not be imposed unless an industry was proven to be earning excessive profits from rises to its product prices because of certain global economic conditions.
TT: How about imposing a tax on the rich?
Liu: Regarding to idea of taxing the rich, we will look to follow the global trend. This means the ministry will research the taxation systems of other countries and see if there is anything applicable to Taiwan’s case.
However, with the current wave of globalization, we should also carefully consider the costs of imposing any new taxes. For example, if the nation’s investments decline because a certain tax is imposed, the domestic labor market and the nation’s economy could be adversely affected. It is very important for the government to carefully deliberate on this issue to make sure the right balance is reached.
TT: In November, a National Treasury Agency official said the nation’s debt is expected to reach NT$5.1 trillion (US$172.48 billion) this year, which accounts for about 37 percent of the average GNP over the past three years — getting closer and closer to the statutory debt ceiling of 40 percent. Is the ministry planning to enhance the statutory debt ceiling?
Liu: So far the ministry has no plans to enhance the statutory debt ceiling, so certainly we have to tap new sources to finance the government’s expenditure, as well as look for other areas of income.
Last month, when I still served as Council for Economic Planning and Development minister, the council signed a memorandum of understanding regarding future investments in Taiwan with Macquarie Infrastructure and Real Assets, a leading global alternative asset manager that specializes in infrastructure funds. This agreement proved that Taiwan remains an attractive investment market for a lot of foreign investors.
So from my point of view, the ministry can closely cooperate with the Ministry of Economic Affairs to find new financial sources, especially foreign investors, to finance the nation’s infrastructure, further helping lower government expenditure.
TT: Currently, Taiwan’s economy is expected to be powered by the twin engines of domestic demand and exports. Does the nation’s financial policy perfectly match up with monetary policy to drive up the economy?
Liu: We do not have too much space to discuss monetary policy considering the current global economic uncertainties. It might be best to adjust the balance between financial policy and monetary policy after the economy has digested any impact caused by the eurozone crisis.
With this year’s Semicon Taiwan trade show set to kick off on Wednesday, market attention has turned to the mass production of advanced packaging technologies and capacity expansion in Taiwan and the US. With traditional scaling reaching physical limits, heterogeneous integration and packaging technologies have emerged as key solutions. Surging demand for artificial intelligence (AI), high-performance computing (HPC) and high-bandwidth memory (HBM) chips has put technologies such as chip-on-wafer-on-substrate (CoWoS), integrated fan-out (InFO), system on integrated chips (SoIC), 3D IC and fan-out panel-level packaging (FOPLP) at the center of semiconductor innovation, making them a major focus at this year’s trade show, according
DEBUT: The trade show is to feature 17 national pavilions, a new high for the event, including from Canada, Costa Rica, Lithuania, Sweden and Vietnam for the first time The Semicon Taiwan trade show, which opens on Wednesday, is expected to see a new high in the number of exhibitors and visitors from around the world, said its organizer, SEMI, which has described the annual event as the “Olympics of the semiconductor industry.” SEMI, which represents companies in the electronics manufacturing and design supply chain, and touts the annual exhibition as the most influential semiconductor trade show in the world, said more than 1,200 enterprises from 56 countries are to showcase their innovations across more than 4,100 booths, and that the event could attract 100,000 visitors. This year’s event features 17
EXPORT GROWTH: The AI boom has shortened chip cycles to just one year, putting pressure on chipmakers to accelerate development and expand packaging capacity Developing a localized supply chain for advanced packaging equipment is critical for keeping pace with customers’ increasingly shrinking time-to-market cycles for new artificial intelligence (AI) chips, Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) said yesterday. Spurred on by the AI revolution, customers are accelerating product upgrades to nearly every year, compared with the two to three-year development cadence in the past, TSMC vice president of advanced packaging technology and service Jun He (何軍) said at a 3D IC Global Summit organized by SEMI in Taipei. These shortened cycles put heavy pressure on chipmakers, as the entire process — from chip design to mass
SEMICONDUCTOR SERVICES: A company executive said that Taiwanese firms must think about how to participate in global supply chains and lift their competitiveness Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) yesterday said it expects to launch its first multifunctional service center in Pingtung County in the middle of 2027, in a bid to foster a resilient high-tech facility construction ecosystem. TSMC broached the idea of creating a center two or three years ago when it started building new manufacturing capacity in the US and Japan, the company said. The center, dubbed an “ecosystem park,” would assist local manufacturing facility construction partners to upgrade their capabilities and secure more deals from other global chipmakers such as Intel Corp, Micron Technology Inc and Infineon Technologies AG, TSMC said. It
RSS