The basic living expense tax deduction has been raised to NT$210,000 (US$6,457) from NT$202,000 and is to be applicable during the tax season in May next year, the Ministry of Finance said yesterday.
The ministry announced the adjustment on its Web site, saying that the move is expected to benefit about 2.08 million households, while affecting the nation’s tax income by NT$2.6 billion (US$79.9 million).
The Taxpayer Rights Protection Act (納稅者權利保護法) came into effect at the end of 2017, which stipulates that people should not be taxed on the amount they need to cover basic living expenses.
Photo: CNA
The basic living expenses are set at 60 percent of the median disposable income per capita from the preceding year, the ministry said.
A survey released on Aug. 16 by the Directorate-General of Budget, Accounting and Statistics showed that the median disposable income last year was NT$349,359, making the basic living expenses NT$210,000.
The deduction, which can be applied to taxpayers and each of their dependents, is NT$8,000 more than last year, the ministry said.
Meanwhile, the ministry on Nov. 23 last year announced that it would increase other income tax deductions this year to help ease people’s financial burden amid inflationary pressure, which would lower the nation’s tax income by NT$21.7 billion when people file their taxes next year, it had estimated.
It came as the rise in the consumer price index had exceeded the standard 3 percent for adjustments of tax exemptions, standard deductions, special deductions for salary income and for people with physical and mental disabilities, as well as tax brackets, the ministry said.
These tax exemptions and deductions are to cost state coffers NT$24.3 billion in total, it said.
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