Minister without Portfolio Chen Shih-chung (陳時中) yesterday proposed allocating a certain percentage of the securities transaction tax to the National Health Insurance (NHI) system to ensure its financial sustainability.
Taiwan enjoys one of the world’s premier national health insurance systems, but its finances are unhealthy, Chen said while attending the ECCT Europe-Taiwan Healthcare Forum, adding that it chronically suffers from a 1 to 2 percent shortfall, resulting in a financial crisis every few years.
Chen said he was the first health minister who did not resign after raising the NHI premium in 2020, adding that he hoped that this would encourage ministers to take bolder measures in tackling the issue.
Photo: Lo Pei-de, Taipei Times
The current NHI premium rate, at 5.17 percent, is very close to the legal ceiling of 6 percent, leaving very little room for further increases, he said.
If 50 percent of the tax collected from stock transactions were to be allocated to the NHI, it would provide a massive, stable income that would ensure a balanced budget for the NHI system for two decades, he said.
This would also align with the principle that those benefiting from capital gains should bear greater social responsibility, he said.
The Ministry of Health and Welfare had proposed imposing a supplementary premium of 2.11 percent on cumulative annual income from rent, interest or stock dividends that exceeds NT$20,000, but the proposal was abandoned because of a public backlash, he said.
Expressing his support for Chen’s proposal, Minister of Health and Welfare Shih Chung-liang (石崇良) said that about 75 to 80 percent of the NHI’s funding comes from general premiums, while supplementary premiums contributed 9 percent.
Income from supplementary premiums last year was slightly higher than average, at about NT$80 billion (US$2.5 billion), of which NT$10 billion came from stock dividends, Shih said.
Despite a growing economy, capital gains have not been factored into the NHI’s financial structure, he said.
The policy of relying on general premiums drawn from salary income should be changed, and the contribution of supplementary premiums from capital gains should be increased, he said.
The capital gains tax is a significant source of government revenue, with NT$290 billion collected last year, Shih said.
The ministry would be happy to see 50 percent of that income injected into the NHI, he said.
An Executive Yuan official, speaking on condition of anonymity, said the proposal was Chen’s personal opinion and was not an approved Executive Yuan policy.
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