No incentive bias for enterprises: Wu

This was the second time Wu clarified the situation in 10 days, following growing controversy and debates over the content of the Industrial Innovation bill.

Replying to questions from Legislator, Lu Shiow-yen, of the ruling Kuomintang (KMT) at the opening of the new legislative session, Wu said the bill is not designed only to benefit big multinational corporations.

All local small and medium-sized businesses in Taiwan which meet the two key conditions, irrespective of their size or the sectors in which they operate, can apply for the incentives suggested in the bill.

The Executive Yuan (Cabinet) has listed the Industrial Innovation bill among the top priorities to be swiftly deliberated and ratified by the Legislative Yuan in the new session.

Lu said it was widely conceived that the bill was customized to favor foreign conglomerates.

The plan has provoked strong suspicion and complaints from some business and industry leaders, she said.

Clauses in the bill stipulating that only those among the world's 500 biggest enterprises with operations in Taiwan can apply for the 15 percent corporation income tax break have been scrapped, the premier said.

Wu stressed that “in the future, any new provisions added to the bill must not be discriminatory and must not benefit only foreign firms.”

The disputed clauses, deemed as benefiting only large-scale foreign enterprises, stirred up widespread discontent among leading local business groups.

Hon Hai Group chairman, Terry Gou, threatened in mid-February that he would move his company's headquarters out of Taiwan if the Legislative Yuan granted the tax break only to “foreign” enterprises.

“Why does the government treat us as worthless, while treating foreign companies like treasure?” asked an angry Gou.

Acer Group chairman, Wang Jeng-tang, said large enterprises in Taiwan have been defamed by opponents to the bill and warned the government that his company would be forced to leave Taiwan if the bill passed the legislature.

Five or six foreign governments have already provided incentives to Acer in the hope of attracting the computer firm to set up operations in their countries, Wang revealed.

He urged the government not to “sacrifice large business groups' interests to court small companies.”

Premier Yu said his Cabinet will modify contents of the bill that can be discussed by lawmakers in about four weeks' time.

President Ma Ying-jeou recently asserted that even farmers and companies in the agricultural sector will be eligible for investment incentives as long as their work focuses on innovation.

At the same legislative meeting, Wu also answered Lu's questions concerning a proposed economic cooperation framework agreement (ECFA) between Taiwan and China.

The premier pointed out that the Cabinet will do its utmost to push for the sealing of the trade pact that will allow some of Taiwan's products to enter the Chinese market free of customs tariffs.

Taiwan cannot afford to wait any longer in the face of the formation of the ASEAN plus one trade bloc by the Southeast Asian nations and China, he said.

If Taiwan fails to sign the ECFA with China in time, local businesses will be increasingly impacted and quickly hollowed out to harm the economy and people, he added.

Subscribe to The China Post and save 25%. Click here

PrintEmail

Write a Comment

Terms

Enter your comments - 3000 characters max

Type in image code

Submit

 Receive China Post promos
 Respond to this email