The government’s tax revenue last month shrank 2.8 percent annually to NT$131.4 billion (US$4.27 billion), dragged by sharp retreats in revenue from securities transactions and land value incremental tax, the Ministry of Finance said on Wednesday.
The decline came as economic weakness, market volatility and interest rate hikes cooled investment interest, the ministry said.
The ministry collected NT$12.4 billion of securities transaction tax, a 19.1 percent decline from the same period last year, as ongoing global economic weakness drove investors to the sidelines, statistics official Liang Kuan-shuan (梁冠璇) told an online media briefing.
Photo: CNA
The conservative sentiment explains why combined daily turnover on the Taiwan Stock Exchange and the Taipei Exchange fell 9.5 percent year-on-year to NT$289.6 billion last month, Liang said.
Major Taiwanese tech firms recently gave lackluster earnings guidance for this quarter, due to poor order visibility, as the world emerges from the COVID-19 pandemic and people cut spending on technology gadgets in favor of in-person experiences.
Cumulative securities transaction tax revenue in the first four months tumbled 25.2 percent to NT$49 billion, the steepest retreat since 2010, Liang said.
However, she said securities transaction tax revenue could still meet the ministry’s target for this year, adding that the decline in daily turnover has tapered off and has exceeded expectations this month.
Land value incremental tax revenue plunged 34.5 percent year-on-year to NT$5.2 billion after the number of taxable cases dropped 26.9 percent to 38,608, the ministry said.
Unfavorable policy measures — mainly interest rate hikes and bans on transfers of presale house purchase agreements — scared away investors, leaving people with real demand to underpin the market, Liang said.
Other property-related tax items, such as deed tax and combined property tax, also fell by double-digit percentage points, affirming a downcycle, she said.
For the first four months, land value incremental tax revenue fell 37.6 percent to NT$22.8 billion, consistent with a 25.3 percent decline in the number of taxable cases to 56,558, the ministry said.
Other tax categories proved resilient. Personal income tax revenue grew 12 percent to NT$36.9 billion and could increase further this month, when Taiwanese file income taxes for last year’s salary and interest income, cash dividends and other compensation.
Sales tax revenue rose 9.2 percent to NT$14.1 billion, thanks to a considerable increase in vehicle imports, the ministry said.
Cumulative tax revenue in the first four months totaled NT$618.5 billion, up a fractional 0.1 percent from the same period last year and ahead of the government’s budget schedule by 10.4 percent, it said.
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