Taiwan Overhauling Capital Gains Tax
May 16, 2013 Taxation in Taiwan
TAIPEI – Taiwan’s controversial capital gains tax has be re-evaluate in order to make it simpler while bringing in greater levels of tax revenues.
At a meeting held in Taipei on May 16th a government appointed task force came forward with new proposed amendments to the country’s capital gains tax on securities transactions.
Under current regulations, capital gains made from transactions involving stocks traded on the Taiwan Stock Exchang may be subject to a 15 percent capital gains tax.
The current tax has failed to generate any revenues since it was enacted last year, as the tax only comes into effect when the Taiwan Stock Exchange is trading at above 8 500 points.
Under the proposed rules, the 15 percent rate would be scrapped, and the 8 500 point threshold will be removed, with taxpayers now being able to choose whether they are taxed at 0.01 percent on transactions valued at above TWD 1 billion, or to be taxed at 15 percent on the value of any capital gains made.
It is expected that the revised tax could raise greater levels of tax revenues for the government, although no projections have yet been made as to how much tax could be collected.
If the revisions are approved, the tax will be backdated and come into effect from January 1st this year.
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