Lawmakers pass bill to give out vouchers to stimulate economy

Premier Liu Chao-shiuan said he has called a special Cabinet meeting next Monday to approve a budget plan for the approximately NT$857 billion fund and send it on the same day to lawmakers for ratification.

Ministry of Finance officials said the fund will be raised from new bonds to be issued by the government.

Lawmakers of the opposition Democratic Progressive Party failed to make a final push for their alternative proposal of raising the amount by NT$200 to NT$3,800 and distributing this to the people in cash, instead of shopping vouchers.

Not wanting to waste more time on the issue and delay the process, the legislators of the ruling Kuomintang, who command a two-thirds majority in the parliament, approved the bill designed to spur the country’s slumping retail sector and bolster the overall economy.

The plan is projected to boost 2009 gross domestic product growth by 0.64 percentage point if all the vouchers are used.

To meet the government’s target date of beginning the distribution of shopping vouchers on Jan. 18, one week ahead of the traditional Chinese Lunar New Year holidays, the budget must be approved by related legislative committees by Dec. 22 and the plenary session of the legislature by Dec. 26.

People can get their vouchers starting at 8 a.m. Jan. 18 at locations designated by their local household registration offices.

Those who are not in urgent need of the purchasing subsidy may get their vouchers after the holiday until April 30.

The vouchers will be valid for use until Sept. 30, 2009, and retailers or companies must claim reimbursement for the vouchers by Oct. 31, 2009.

Those born by the end of March 2009 with household registrations as citizens of the Republic of China will be eligible for the program, according to one of a set of resolutions attached to the bill.

Spouses from overseas who have married into local families will also be eligible for the vouchers.

Critics of the bill have argued that the voucher program will have potentially high administrative costs, including the cost of printing sophisticated vouchers to make them hard to counterfeit.

To put a ceiling on these expenses, another resolution attached to the bill stipulates that administrative costs should not exceed 3 percent of the special budget earmarked for the program.

The Cabinet proposed the voucher plan last month as a way of pumping money into Taiwan’s flagging retail sector. The vouchers must be used to purchase goods locally and cannot be deposited as savings in banks or exchanged for cash.

Those who donate their coupons to charity, however, will be entitled to a tax deduction.

Premier Liu said governments in Germany and Hong Kong have started considering similar plans of giving shopping vouchers to citizens, showing his Cabinet has adopted the correct measure.

Distributing consumption vouchers is just one of a series of measures the government has proposed to boost the local economy, which has come under growing threats from the worldwide economic recession and has possibly even stagnated.

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