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Minister opposes futures transaction tax reduction

Ministry of Finance (MOF, 財政部) Minister Chang Sheng-ford (張盛和) yesterday stated in the Legislative Yuan that he opposes the reduction of the futures transaction tax proposed by financial companies.

Financial business representatives stated that the tax is relatively high compared to other countries, making companies overseas unwilling to invest in the local market. In addition, if more institutes were willing to trade in the futures market, the stock market would be more stable.

According to Chang, the futures transaction tax was reduced once in the history of Taiwan, but the transaction volume did not increase.

Chang said that tax reductions over the past 50 years have boosted the economy, but he emphasized that after the European debt crisis, the solvency of the government became the most important foundation for economic growth.

The current futures transaction tax rate is 0.004 percent. The reduction of the tax was proposed in the meeting convened by the Executive Yuan in August. Afterward, Premier Sean Chen instructed the MOF and the Financial Supervisory Commission (FSC) to establish a joint committee to discuss the issue. The first meeting of the joint committee was held yesterday.

Energy Tax a Priority for MOF

Minister Chang stated that the Executive Yuan demanded the MOF to propose a draft of the energy tax by the end of December; he added that the energy tax is part of the government's plan to boost the economy; therefore, he said, the ministry has to make the tax a priority.

The finance minister added that the committee for tax reform decided in 2009 that the energy tax would be part of the government's policy to reduce carbon emission, and the establishment of the energy tax should be discussed among the MOF and other government departments related to environmental protection and energy.

Chang said since the Environmental Protection Agency (環保署) and the Ministry of Economic Affairs (MOEA, 經濟部) have conducted several measures concerning the reduction of carbon emission, the MOF will propose a draft of the energy tax at the right time while taking into consideration the profitability of private enterprises and economic development.

Chang said the MOF has sent an official document to the MOEA to seek its advice concerning the impact of the tax to the already dire economic condition.

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