TAIPEI (Taiwan News) — Experts at a TPP hearing on Monday highlighted flaws in Taiwan’s tax administration and financial model, with some advocating for the return of tax surpluses to the public.

KMT Caucus Secretary-General Wang Hung-wei (王鴻薇) proposed that the government return its tax surplus to citizens in the form of a NT$10,000 rebate, on Feb. 12. KMT Caucus Leader Fu Kun-chi (傅崐萁) echoed the idea, suggesting that the surplus should benefit the public, and identified the rebate policy as the KMT’s priority for the current legislative session.

During the TPP hearing, experts noted that Taiwan’s repeated annual tax surpluses could signal deficiencies in the country’s financial planning, per a TPP press release. They called on the government to use the surplus to pay Taiwan’s national debt.

Professor Chen Kuo-liang (陳國樑), chair of the Department of Public Finance at National Chengchi University, said the government allocates only about 5.1% of its budget to debt repayment, despite regularly having a tax surplus. Chen proposed that all tax surpluses be directed toward debt repayment to prevent potential misuse.

National Taipei University of Business Assistant Professor Lo Wan-shih (羅萬時), an expert in public finance and tax administration, agreed with Chen and suggested an amendment to the Budget Act.

National Taipei University of Business Professor Huang Yao-huei (黃耀輝) raised concerns over Taiwan's rising tax incidence rate of 14.8%, the highest in 26 years, and recurring tax surpluses, indicating a flaw in the government’s financial projections. Huang urged the government to return the tax surplus to taxpayers instead of using it for special budgets unless it is used to repay Taiwan's debt.

National Sun Yat-sen University Professor and former TPP Legislator Jang Chyi-lu (張其祿) recommended a more balanced approach, proposing that the surplus could be used to fund Taiwan’s healthcare system or repay national debt, while still providing cash rebates to less privileged members of society.

Ministry of Finance Taxation Administration Director-General Sung Hsiu-ling (宋秀玲) addressed concerns about the tax administration, noting that her ministry had commissioned a report from Chen’s team, per CNA. Sung suggested that the gap between the commissioning of the report and the adoption of its recommendations may have contributed to the current tax surplus.

TPP Chair Huang Kuo-chang (黃國昌) criticized the DPP administration's inconsistent stance on rebates, noting that while the previous administration under President Tsai Ing-wen (蔡英文) issued rebates, the current administration under President Lai Ching-te (賴清德) opposed them. Huang also pointed out that the DPP administration’s use of special budgets often exceeded the annual tax surplus.

In response, National Development Council Deputy Director Chen Mei-chu (陳美菊) clarified that the rebate issued under Tsai was intended to stimulate the economy after the COVID-19 pandemic, and Huang requested a report evaluating the effectiveness of that policy.