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Economic Daily News: Restart tax reform

Economic Daily News: Restart tax reform

Taiwan editorial abstract (File 6 of a daily roundup) The controversial Tax Reform Committee has been finally disbanded after 18 months of operations at an expense of NT$20 million in taxpayers' money.
The committee had a bumpy start, with its goals, organizational framework, roster and operational mode coming under question from the very beginning. Its repeated endorsement of the Executive Yuan's policy proposals made it more like a rubber stamp organ rather than an arm dedicated to reform and innovation.
Some of the committee's actions pandering to special interest groups drew even more fire and prompted some commissioners to boycott its meetings in protest. Its closure came as a relief for some.
To be fair, the committee contributed more to tax simplification than to overhauling the tax system into a more just and balanced one.
Most regrettable is that the committee failed to introduce a capital gains tax while largely cutting the inheritance and gift tax rate to 10 percent without imposing any accompanying measures to minimize its impact.
Unfair taxation has long been a source of public grievance, with capital gains tax on stock transactions as the top target.
The committee has let the public down due to its inaction in this regard.
Success in tax reform tends to hinge on the leadership's determination and guts as well as a well-devised package of measures and incentives.
It does not bode well for any future plans to increase taxes after the committee failed to introduce them at the same time that tax reductions were introduced during its tenure.
As a remedy, the government should now show its execution capability by introducing energy tax, environment tax and special consumption tax, resuming capital gains tax on stock transactions, and raising business tax rates to win back public trust.
The Ministry of Finance should from now on take up the mission of studying relevant problems and initiating feasible tax reform measures.
(By Sofia Wu)




Updated : 2021-04-12 08:06 GMT+08:00