ASIA NEWS NETWORK
WE KNOW ASIA BETTER
Taiwan govt slammed over local bourse's poor performance
Publication Date : 30-10-2012
Taiwan lawmakers yesterday slammed the government over the stock market's lacklustre performance during a Finance Committee meeting at the Legislative Yuan, largely blaming the Ministry of Finance (MOF) for proposing the stock gains tax.
Kuomintang (KMT) Legislator Lu Shiow-yen said yesterday that the finance-related organs of the government should take responsibility of the mess, and proposed to keep the 2013 revenue target of the stock transaction tax at NT$126.6 billion (US$4.3 billion), in spite of the MOF's recently announced plan to decrease the amount to NT$96.4 billion.
Lu's proposal was dismissed after negotiations held at noon yesterday, while Democratic Progressive Party lawmaker Wu Ping-jui's proposal to decrease the 2013 target to approximately NT$96.3 billion was reserved for further consideration.
KMT lawmaker Sun Ta-chien said that the administration's incompetence has led to a substantial trade volume decrease on the local bourse, adding that the government is also to blame for the stagnation of labour wages.
Sun went on to say that he plans to propose an abolishment of the MOF's stock gains tax plan.
MOF officials said yesterday that stock transaction tax revenue this year will be approximately NT$51.8 billion less than previously forecast; therefore, the 2013 target should be adjusted to around NT$96.4 billion — NT$30.1 billion less than this year's figure.
In response, several lawmakers said that the new figure was still too high, while others blasted finance officials over the expected decrease in revenue, arguing that the ministry-proposed stock gains tax plan has adversely affected Taiwan's stock market.
Finance Minister Chang Sheng-ford said yesterday that the stock gains tax was not the only factor affecting the market, adding that even without the tax, many neighbouring stock markets have seen larger decreases than Taiwan's 21.28 per cent — Hong Kong's stock market has shrunk 26.49 per cent, South Korea 30.45 per cent and Shenzhen 34.22 per cent.
He reiterated that the market's decrease cannot be blamed solely on the stock gains tax.
Vice Premier Jiang Yi-huah said yesterday that the Cabinet has no plans to postpone the stock gains tax's implementation, or decrease the stock transaction tax. “The finance minister has already explained the government's policy very clearly,” Jiang added.
*US$1=29.2 Taiwan dollars