Lawmakers across party lines yesterday agreed to July 1 as the provisional date on which a draft amendment to the Income Tax Act (所得稅法) is to come into effect, with the aim of curbing real-estate speculation.
The consensus was reached following interparty negotiations at the legislature’s Finance Committee to determine when revisions to the “integrated house and land transaction income tax” would take effect.
The committee on Monday last week passed a number of revisions to the act, but failed to agree on when they would take effect.
Photo: CNA
Under the proposed revisions, the tax would be set at 45 percent of gains on the sale of property within two years of purchase and 35 percent of gains on property sales made within two to five years of purchase.
For foreign nationals and companies, the tax rate on property sales would be 35 percent on any property held for more than two years.
The same tax rate would be imposed on individuals and businesses to prevent individuals from setting up companies to buy and sell property, and paying only 20 percent corporate income tax on gains.
At present, the integrated house and land transaction income tax rate is 45 percent of gains on sales of property made within a year of purchase and 35 percent of gains on sales of property made within one to two years of purchase — but those rates only apply to individuals.
The revisions also widen the scope of properties to which the tax applies.
For example, the tax currently applies only to transactions of existing residential properties not considered to be for “self-use,” whereas the new measure would also apply to the sale of presale homes, above-ground use of land rights (superficies) and special shareholdings.
The measures would be applied retroactively to transactions from 2016.
Lawmakers also agreed to add a clause to the revisions in which individuals and businesses given a share of a land or property as a result of urban renewal projects would enjoy a 20 percent tax on gains made from property sales made within five years.
The proposed revisions have been sent to the legislature’s plenary session for discussion.
The integrated house and land transaction income tax was introduced in 2016 to reduce property speculation, especially in the residential property market.
The latest measures have been proposed as the property market heats up at a time of high liquidity and low interest rates.
ELECTRONICS BOOST: A predicted surge in exports would likely be driven by ICT products, exports of which have soared 84.7 percent from a year earlier, DBS said DBS Bank Ltd (星展銀行) yesterday raised its GDP growth forecast for Taiwan this year to 4 percent from 3 percent, citing robust demand for artificial intelligence (AI)-related exports and accelerated shipment activity, which are expected to offset potential headwinds from US tariffs. “Our GDP growth forecast for 2025 is revised up to 4 percent from 3 percent to reflect front-loaded exports and strong AI demand,” Singapore-based DBS senior economist Ma Tieying (馬鐵英) said in an online briefing. Taiwan’s second-quarter performance beat expectations, with GDP growth likely surpassing 5 percent, driven by a 34.1 percent year-on-year increase in exports, Ma said, citing government
UNIFYING OPPOSITION: Numerous companies have registered complaints over the potential levies, bringing together rival automakers in voicing their reservations US President Donald Trump is readying plans for industry-specific tariffs to kick in alongside his country-by-country duties in two weeks, ramping up his push to reshape the US’ standing in the global trading system by penalizing purchases from abroad. Administration officials could release details of Trump’s planned 50 percent duty on copper in the days before they are set to take effect on Friday next week, a person familiar with the matter said. That is the same date Trump’s “reciprocal” levies on products from more than 100 nations are slated to begin. Trump on Tuesday said that he is likely to impose tariffs
HELPING HAND: Approving the sale of H20s could give China the edge it needs to capture market share and become the global standard, a US representative said The US President Donald Trump administration’s decision allowing Nvidia Corp to resume shipments of its H20 artificial intelligence (AI) chips to China risks bolstering Beijing’s military capabilities and expanding its capacity to compete with the US, the head of the US House Select Committee on Strategic Competition Between the United States and the Chinese Communist Party said. “The H20, which is a cost-effective and powerful AI inference chip, far surpasses China’s indigenous capability and would therefore provide a substantial increase to China’s AI development,” committee chairman John Moolenaar, a Michigan Republican, said on Friday in a letter to US Secretary of
‘REMARKABLE SHOWING’: The economy likely grew 5 percent in the first half of the year, although it would likely taper off significantly, TIER economist Gordon Sun said The Taiwan Institute of Economic Research (TIER) yesterday raised Taiwan’s GDP growth forecast for this year to 3.02 percent, citing robust export-driven expansion in the first half that is likely to give way to a notable slowdown later in the year as the front-loading of global shipments fades. The revised projection marks an upward adjustment of 0.11 percentage points from April’s estimate, driven by a surge in exports and corporate inventory buildup ahead of possible US tariff hikes, TIER economist Gordon Sun (孫明德) told a news conference in Taipei. Taiwan’s economy likely grew more than 5 percent in the first six months
RSS