The Executive Yuan yesterday approved its version of draft amendments that would raise funds for local governments to a record high of NT$1.2 trillion (US$38.34 billion) next year.
The Cabinet’s amendments to the Act Governing the Allocation of Government Revenues and Expenditures (財政收支劃分法) would increase the total amount of centrally allocated tax revenue, general subsidies and project-based subsidies, Executive Yuan Secretary-General Xavier Chang (張惇涵) told a news conference.
Allocations to the six special municipalities — Taipei, New Taipei City, Taoyuan, Taichung, Tainan and Kaohsiung — would rise by 15 percent, while allocations to the 16 other local governments would increase by 25 percent, Chang said.
Photo: Lo Pei-de, Taipei Times
The Cabinet’s version balances the distribution of funds to ensure that central and local governments have a closer relationship and a more reasonable financial distribution, he said.
It also considered local agricultural production, tobacco and alcohol tax rates and pollution in formulating the amendments, he added.
However, the draft bill faces dim prospects in the opposition-controlled legislature, which passed its own revisions to the act on Friday last week.
The Chinese Nationalist Party (KMT) caucus in a statement said that the Cabinet’s version is not in line with public opinion and that the Executive Yuan should review the newly amended act before proposing another version.
The Taiwan People’s Party (TPP) caucus said that Premier Cho Jung-tai (卓榮泰) might be derelict in his duties for failing to draft a budget in accordance with the version passed by the legislature.
The current act, amended by the legislature in December last year, has been criticized for uneven urban-rural distribution and a flawed formula.
Amended Article 16-1 mistakenly stated that the calculations for centrally funded tax revenue would be based on “all 22 cities and counties” instead of “the 19 cities and counties on Taiwan proper,” resulting in 0.2 percent of funds being unable to be distributed for municipalities on Taiwan, and 99.8 percent of funds being unable to be distributed to outlying islands.
The total amount of funding that cannot be distributed stands at NT$34.5 billion, the Cabinet said previously.
Paragraph 3, Article 30 also states that general subsidies from the central to local governments should not be less than the total of the previous year.
However, the interpretation of the central government — which said that the total amount would remain unchanged, but the amount allotted to individual municipalities could vary — was at odds with that of local government heads, who said that funding to each municipality should not be less than the previous year.
The Ministry of Finance yesterday said that the Cabinet’s draft aims to achieve five major goals: more balanced quality of life for citizens, fairer urban-rural distribution, stronger central-local government partnerships, more reasonable distribution across financial and administrative expenses, and strengthened local autonomy.
Central government subsidies for local governments include shared tax revenue and grants, with the total amount to at least match this year’s figure, the bill says.
Shared tax revenue next year would total NT$821.3 billion, a NT$353.7 billion increase from this fiscal year, the draft says.
The increase would negate the need for additional “augmentation funds” within general grants, although NT$108 billion in funding would be returned to local governments for administrative functions, it said.
Shared tax revenue would first be used to cover local governments’ fiscal shortfalls, ensuring that essential expenditures are met and that all local governments start from an equal fiscal baseline, the ministry said.
Of the NT$250.1 billion to be used for general grants, NT$142.1 billion would be reserved for education, social welfare and basic infrastructure, while the remaining NT$108 billion would be included in basic fiscal needs first covered by shared tax revenues, it said.
The draft amendments include a formula to ensure fair distribution across the 22 municipalities, incorporating factors such as population structure, land management and pollution-control costs to balance urban-rural and agricultural-industrial needs, and regional development, it said.
As for project-based grants to improve quality of life and support major public infrastructure, such as rail projects, they would remain at NT$236.8 billion, after the expiration of phase five of the Forward-looking Infrastructure Development Plan this year, it added.
CROSS-STRAIT COLLABORATION: The new KMT chairwoman expressed interest in meeting the Chinese president from the start, but she’ll have to pay to get in Beijing allegedly agreed to let Chinese Nationalist Party (KMT) Chairwoman Cheng Li-wun (鄭麗文) meet with Chinese President Xi Jinping (習近平) around the Lunar New Year holiday next year on three conditions, including that the KMT block Taiwan’s arms purchases, a source said yesterday. Cheng has expressed interest in meeting Xi since she won the KMT’s chairmanship election in October. A source, speaking on condition of anonymity, said a consensus on a meeting was allegedly reached after two KMT vice chairmen visited China’s Taiwan Affairs Office Director Song Tao (宋濤) in China last month. Beijing allegedly gave the KMT three conditions it had to
STAYING ALERT: China this week deployed its largest maritime show of force to date in the region, prompting concern in Taipei and Tokyo, which Beijing has brushed off Deterring conflict over Taiwan is a priority, the White House said in its National Security Strategy published yesterday, which also called on Japan and South Korea to increase their defense spending to help protect the first island chain. Taiwan is strategically positioned between Northeast and Southeast Asia, and provides direct access to the second island chain, with one-third of global shipping passing through the South China Sea, the report said. Given the implications for the US economy, along with Taiwan’s dominance in semiconductors, “deterring a conflict over Taiwan, ideally by preserving military overmatch, is a priority,” it said. However, the strategy also reiterated
‘BALANCE OF POWER’: Hegseth said that the US did not want to ‘strangle’ China, but to ensure that none of Washington’s allies would be vulnerable to military aggression Washington has no intention of changing the “status quo” in the Taiwan Strait, US Secretary of Defense Pete Hegseth said on Saturday, adding that one of the US military’s main priorities is to deter China “through strength, not through confrontation.” Speaking at the annual Reagan National Defense Forum in Simi Valley, California, Hegseth outlined the US Department of Defense’s priorities under US President Donald Trump. “First, defending the US homeland and our hemisphere. Second, deterring China through strength, not confrontation. Third, increased burden sharing for us, allies and partners. And fourth, supercharging the US defense industrial base,” he said. US-China relations under
The Chien Feng IV (勁蜂, Mighty Hornet) loitering munition is on track to enter flight tests next month in connection with potential adoption by Taiwanese and US armed forces, a government source said yesterday. The kamikaze drone, which boasts a range of 1,000km, debuted at the Taipei Aerospace and Defense Technology Exhibition in September, the official said on condition of anonymity. The Chungshan Institute of Science and Technology and US-based Kratos Defense jointly developed the platform by leveraging the engine and airframe of the latter’s MQM-178 Firejet target drone, they said. The uncrewed aerial vehicle is designed to utilize an artificial intelligence computer
RSS