FSC head supports scrapping of capital gains tax plan


CNA

TAIPEI–The chairman of the Financial Supervisory Commission (FSC,�Ҩ��ʷ��޲z�e���|) said Thursday that he supports a possible U-turn on the proposed capital gains tax in the stock market targeting major market players. Asked by ruling Kuomintang lawmaker Lai Shyh-bao (���h��) in a hearing at the finance committee of the Legislative Yuan (�ߪk�|�]�g�e���|) whether he supports the scrapping of the plan, Tseng Ming-chung (���ʩv) answered ��yes.�� The planned tax has sparked an outcry in the local market, with many market analysts blaming the tax for a recent shrinkage in daily turnover and urging the government to lower the tax burden or even eventually abolish the tax. The capital gains tax under the income tax law, which was passed in mid-2013 and is scheduled to go into effect next year, will impose a new tax on investors who make NT$1 billion or more in trades a year. These major market players will have the choice of paying either a 15 percent tax on their capital gains or an extra 0.1 percent transaction tax on their stock transactions.

Taiwan already imposes a transaction tax of 0.3 percent on all stock market trades but does not tax gains on stock transactions. KMT lawmaker Lo Ming-tsai (ù���~) has proposed a bill to raise the threshold for the tax to NT$5 billion from NT$1 billion to allow market major players to pay less in taxes. The Legislative Yuan is scheduled to review the bill next week. Lo has said he does not rule out the possibility of filing a motion to scrap the new tax altogether. Last week, the Ministry of Finance (�]�F��), which had previously insisted on the new capital gains tax, said that it needs to reevaluate the impact on the local stock market, comments that have been perceived as a backing-down from its earlier stance.