Tax draft allows more to apply for deductions
The China Post news staff
September 7, 2012, 12:19 am TWN
The China Post news staff--The Executive Yuan yesterday passed a draft amendment to the Income Tax Act (ITA). Authorities concluded that taxpayers supporting relatives — who are above 20 years old, disabled, dependent or enrolled in schools — will be qualified for tax cuts, as soon as the new act takes effect next May.
According to the act's current rules, taxpayers are not eligible for tax deductions if their dependent relatives are between the ages of 20 and 60.
The act, however, does specify that taxpayers may meet qualifications for tax reductions if they take care of relatives who are below 20 years old or above 60, disabled, dependent or enrolled in schools.
As interpreted by the grand justices, the current ITA violates the Constitution's principle of equality. The justices explained that no taxpayer can be disqualified for tax deductions due to any age requirement for their dependent relatives.
In a statement released by the grand justices, the current ITA will lose its effectiveness by Dec. 30.
A government official from the Executive Yuan stated that the government has received applications from taxpayers seeking tax deductions; however, due to age requirements for their dependent relatives, all applicants failed to qualify for deductions according to present regulations.