The basic living expense tax deduction is to be raised by NT$4,000 to NT$196,000, benefiting an estimated 2.3 million households, the Executive Yuan said yesterday.
Following the adjustment, a family of four with a 12 percent tax rate would save up to NT$1,920 in taxes per year, while single taxpayers who earn less than NT$540,000 a year could save NT$200, the Directorate-General of Budget, Accounting and Statistics (DGBAS) said in a report last month.
The proposal was made by the Ministry of Labor at a Cabinet meeting yesterday, and would go into effect ahead of next year’s tax due date in May.
It would be the sixth consecutive year that the basic living expense deduction has been increased.
Last year saw the biggest increase in the nation’s history, when it was increased by NT$10,000 to NT$192,000.
Under the Taxpayer Rights Protection Act (納稅者權利保護法), individuals should not be taxed on the amount they need to cover basic expenses, which is defined as 60 percent of the median disposable income per capita from the preceding year.
Based on last year’s median disposable income of NT$326,000 — an increase of NT$6,000 from 2020 — the basic living expense deduction would be NT$196,000, the DGBAS said last month.
The deduction update came after the Cabinet on Wednesday approved a minimum wage increase, Executive Yuan spokesperson Lo Ping-cheng (羅秉成) said yesterday.
Starting from Jan. 1, the basic wage is to increase from NT$25,250 to NT$26,400 for monthly earners, or from NT$168 to NT$176 hourly, benefitting 2.32 million people, he said.
It is the seventh consecutive year that the minimum wage has been raised under President Tsai Ing-wen (蔡英文), Lo said.
In that time, the monthly minimum wage has increased 31.9 percent while the hourly minimum wage has risen 46.7 percent, showing the administration’s determination to support the working class, he said.
It is not easy to reach a consensus on wage increases, Premier Su Tseng-chang (蘇貞昌) said, thanking employers and employees for coming together on the issue, and the government for listening to the needs of both sides.
A wage hike offers crucial support to young people entering the workforce and disadvantaged members of society, he said, urging the ministries of economic affairs and labor to work quickly to develop a set of accompanying measures for businesses to cope with the increased wages.
Regarding a new version of the scrapped Minimum Wage Act (最低工資法), Lo said that the Cabinet is still deliberating its draft.
However, even without a dedicated law, there is still a mechanism for increasing the minimum wage, as evidenced by the past seven years of raises, he added.
Additional reporting by CNA
Taipei on Friday rejected Hanoi’s characterization of its recent live-fire drill near Itu Aba Island (Taiping Island, 太平島) as “illegal,” saying that Taiwan’s claim to the small island in the South China Sea was “unquestionable.” The Ministry of Foreign Affairs (MOFA) said in a statement that the comments made by its Vietnamese counterpart about the military’s routine live-fire drills near Itu Aba on Tuesday were “unacceptable.” Earlier on Friday, Vietnamese Ministry of Foreign Affairs spokeswoman Le Thi Thu Hang called Taiwan’s military activity “a serious violation of Vietnam’s territorial sovereignty,” saying it had caused tensions and complicated the situation in the region. Hang
Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) yesterday said it is more than doubling its US investment to US$40 billion as it plans to make 3-nanometer chips in 2026 at a second Arizona fab, adding to the chipmaker’s original plan of building a US$12 billion fab to make 4-nanometer chips in 2024. The investment would mark the largest foreign direct investment in Arizona’s history and one of the largest foreign direct investments in the history of the US, the world’s largest contract chipmaker said in a statement yesterday. In addition to the more than 10,000 construction workers at the site, TSMC’s two fabs
ENHANCEMENT: The sale would update Taiwan’s Patriot missile system to improve its missile defensive capability and deter threats, the US Department of State said The US has proposed selling Taiwan as many as 100 of its most advanced Patriot air-defense missiles along with radar and support equipment in a deal valued at US$882 million, according to a US Department of State notice obtained by Bloomberg News. The proposal was made under the provisions of a 2010 sale and so technically is not new. It is classified as an enhancement to the earlier deal, with a potential total value of US$2.81 billion. The upgrade would not change the overall value of that deal, which infuriated Beijing at the time and led it to halt planned military exchanges
‘UNITED FRONT’ TOOL? There are already many accounts on Douyin impersonating government agencies, and even Premier Su Tseng-chang, DPP Legislator Mark Ho said Lawmakers and a number of experts yesterday called on the government to ban or heavily regulate Douyin (抖音) over concerns that the short-video platform could be used by China to spread disinformation. Owned by ByteDance Ltd (字節跳動), Douyin and its international version, TikTok, are a subject of concern in democracies worldwide because of potential manipulation by the Chinese government. FBI Director Chris Wray on Friday said that Beijing might have the ability to control TikTok’s recommendation algorithm, “which allows them to manipulate content, and if they want to, to use it for influence operations.” TikTok could also be used to collect personal data