Parliament to extend preferential land tax system for one more year

Dec 22, 2003 Ι Industry In-Focus Ι Furniture Ι By Ben, CENS
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Taipei, Dec. 22, 2003 (CENS)--In a bid to win more votes for their party candidates in the upcoming presidential election, lawmakers of both the ruling and opposition parties, are promoting the extension of the preferential land value incremental tax rate for another year. The preferential tax measure will expire by the end of January next year.

Some legislators even advocated the preferential tax system should be legalized as a normal practice.

It is expected the prolonged preferential tax system will stimulate trading in the domestic real estate market.

Currently the temporary land value increment tax rates are set at 20%, 25% and 30%. But the revised tax laws preliminarily screend by the Legislative Yuan set the rates at 20%, 30% and 40%. To soothe the dissatisfaction of the public and the meet the demand of landlords, many legislators are considering extending the preferential tax measure for another year.

A ruling-party legislator said extension of the preferential tax measure is the bottom line of both the ruling and opposition parties and the Ministry of Finance won't be against it.

Lawmaker Lin Chung-cheng of the ruling Democratic Progressive Party explicitly noted his party intends to extend the preferential tax measure for one or two more years or even legalize the measure by way of revising related law.

Yin Nai-ping, a legislator of the opposition People First Party, insisted that the landlords holding the lands for a long period of time should enjoy preferential tax rates. For instance, the ones who own lands for more than 10 years will enjoy a tax cut by one-fourth; the ones holding lands for more than 20 years will enjoy a tax cut by half. But the MOF has opposed to Yin's suggestion, saying such a measure will seriously affect the collection of taxes.

MOF currently sticks to the policy that the land value increment tax should be set at 40%, 30% and 20% as initially screened by the Legislative Yuan.
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