Taipei, April 7, 2011 (CENS)--The financial committee of the Legislative Yuan approved the luxury tax bill yesterday (April 6), which may take effect on June 1, one month ahead of the original schedule.
This is the first new tax bill under the administration of President Ma Ying-jeou, which is expected to bring NT$15 billion of extra tax revenue to national coffers annually. The income will be used for social welfare and emergency relief.
The proposed tax aims to curb short-term housing speculation and narrow the wealth gap by taxing luxurious consumption behaviors of the rich.
The financial committee passed the bill, without making any major revision. The tax targets transfer of non-own use housing and land with less than two years of ownership; auto, yacht, aircraft, helicopter, and light plane worth over NT$3 million; and furniture, hawksbill turtle, turtle shell, ivory, fur, and their products worth over NT$500,000. Transfer of non-own use realty with less than two-year ownership, for instance, will be subject to 10-15% tax.
One revision to the version of the executive branch is the itemization of exemption case from the tax, including the obtaining of realty via urban renewal projects.
The bill will be sent to floor of the Legislative Yuan for second and third reading before enactment by the end of May.