Average daily day trading transaction on the local stock market climbed to a high of NT$66.1 billion (US$2.36 billion) in March, prompting a call for the Financial Supervisory Commission (FSC) to rethink an extension of a tax cut on day trading transactions.
In April 2017, a tax cut on day trading transactions — from 0.003 percent to 0.0015 percent — took effect. It was to return to the previous level next year, but the commission and the Ministry of Finance have proposed extended the cut for another five years.
Experts said the policy favors intraday traders and has made the local stock market a “casino.”
Appacus Foundation president Sean Chen (陳沖), a former vice premier and former FSC chairman, on Monday said that the tax cut extension would incentivize investors to engage in day trading rather than make long-term investments.
The tax cut was implemented as a “shot in arm” for the market, as turnover was less than NT$100 billion in a single day, but turnover soared to more than NT$700 billion last month, Chen said.
If the government normalizes the tax cut, it would send a message to investors that day trading has better tax rates than long-term investing, and would make the market a “casino,” he said.
FSC Chairman Thomas Huang (黃天牧) told reporters on the sidelines of an event in Taipei on Monday that while he respected Chen’s opinion, he did not agree with the casino analogy.
Whether reducing a single tax makes the market a “casino” needs careful consideration, Huang said, adding that further discussion about the extension were welcomed.
Day trading is just a mechanism that allows investors to make profits by buying or selling shares over short periods, and can boost the market trading volume, the commission said.
Average daily day trading transaction advanced to a record NT$66.1 billion in March, accounting for 30.34 percent of total market turnover, up from an average of NT$10.6 billion and a weighting of 9.63 percent from April 2016 to March 2017, a year before the tax cut took effect, FSC data showed.
The average daily amount of day trading transactions rose to NT$37.5 billion during the first year of the tax reduction, making up 22.34 percent of total transactions, the data showed.
The number of day traders increased to 108,000 at the end of last year, up from 44,000 a year earlier, the data showed.
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
NO BREAKTHROUGH? More substantial ‘deliverables,’ such as tariff reductions, would likely be saved for a meeting between Trump and Xi later this year, a trade expert said China launched two probes targeting the US semiconductor sector on Saturday ahead of talks between the two nations in Spain this week on trade, national security and the ownership of social media platform TikTok. China’s Ministry of Commerce announced an anti-dumping investigation into certain analog integrated circuits (ICs) imported from the US. The investigation is to target some commodity interface ICs and gate driver ICs, which are commonly made by US companies such as Texas Instruments Inc and ON Semiconductor Corp. The ministry also announced an anti-discrimination probe into US measures against China’s chip sector. US measures such as export curbs and tariffs
The US on Friday penalized two Chinese firms that acquired US chipmaking equipment for China’s top chipmaker, Semiconductor Manufacturing International Corp (SMIC, 中芯國際), including them among 32 entities that were added to the US Department of Commerce’s restricted trade list, a US government posting showed. Twenty-three of the 32 are in China. GMC Semiconductor Technology (Wuxi) Co (吉姆西半導體科技) and Jicun Semiconductor Technology (Shanghai) Co (吉存半導體科技) were placed on the list, formally known as the Entity List, for acquiring equipment for SMIC Northern Integrated Circuit Manufacturing (Beijing) Corp (中芯北方積體電路) and Semiconductor Manufacturing International (Beijing) Corp (中芯北京), the US Federal Register posting said. The
India’s ban of online money-based games could drive addicts to unregulated apps and offshore platforms that pose new financial and social risks, fantasy-sports gaming experts say. Indian Prime Minister Narendra Modi’s government banned real-money online games late last month, citing financial losses and addiction, leading to a shutdown of many apps offering paid fantasy cricket, rummy and poker games. “Many will move to offshore platforms, because of the addictive nature — they will find alternate means to get that dopamine hit,” said Viren Hemrajani, a Mumbai-based fantasy cricket analyst. “It [also] leads to fraud and scams, because everything is now
RSS