Finance minister ready to launch plan to pay national debt
The China Post news staff
February 23, 2014, 12:06 am TWN
TAIPEI, Taiwan -- The Ministry of Finance (MOF) will be making a report today on a plan aimed at stabilizing the nation's financial status and debts, Finance Minister Chang Sheng-ford (張盛和) said yesterday.
According to Chang, the MOF's first step will be to take control of the national debt; the second will be to readjust the government expense structure and then to raise money in a variety of ways. After the plan is launched, the government will be selling the national bonds and preparing for future tax reforms, said Chang.
In order to make up for Taiwan's financial debts, the MOF released the blueprint for the plan last year. Premier Jiang Yi-huah (江宜樺) announced the direction of the plan on Friday, also mentioning the government's slated budget for 2015 which includes a debt ceiling that has been reduced to NT$307.2 billion.
Chang pointed out that the national debt in recent years amounted to roughly NT$27 billion to NT$30 billion; if the government is to reduce the debt, it will have to come up with a variety of means to glean revenue.
In order to keep debt in check, the MOF will have to prevent the debt ceiling from rising; the government will also be adjusting its expense structure and the structure of the fiscal revenues, including the expenses spent on the nation's infrastructure and reducing inefficient spending on items such as pension reform and social welfare. The government will also be introducing private inflows of funds in order to minimize the financial pressure, said Chang. "The private flows include self-liquidated and non-self-liquidated funds; these may not be included in the public budget," Chang added.
Another step would be to increase the possible ways to rake in additional revenue. The MOF's plan includes raising the efficiency of publicly funded enterprises and stimulating land vitalization. For example, the government may rent national land designated for nonpublic use in order to increase revenue, said Chang.
Selling public bonds and implementing a tax reform would be the last thing on the MOF's agenda, Chang stated.
According to the National Debt Clock, Taiwan's debt reached NT$5.4618 trillion in January, equivalent to NT$234,000 per person, a figure NT$6,000 higher than that of the previous month.
As of January, Taiwan's long-term debt totaled NT$5.1923 trillion, NT$70 million higher than that of the previous month. Short-term debt totaled NT$269.5 million, NT$55 million higher than the previous month.