New Tax Has Positive Effect in Taiwan
March 11, 2014 Taxation in Taiwan
TAIPEI – The government of Taiwan has confirmed the success of the national luxury tax, and is now looking to further expand the measure..
The results of the application of the “luxury tax”, enacted in Taiwan in June 2011, have been very successful, and the national tax authority now feels that the measure needs only very slight adjustment to maximize the effect of the tax, according to a statement made by the Minister of Finance of Taiwan Chang Sheng-ford on March 10th.
According to the Minister, the biggest impact of the new tax has been the evident stabilization of prices on the real estate market, where, he noted, the real price of residential property has fallen by as much as 70 percent, while the price of property in major cities such as Taipei and Xinbei has risen only slightly.
In an effort to further refine the tax, the national Financial Supervisory Commission has already begun to work on several amendments to the tax, such as including industrial property under the scope of the tax, and clarifying the rules regarding the applicability when individuals sell one property in order to finance the purchase of a new private home.
Further, the government is looking into the feasibility of extending the nature of the tax to include the sale of high priced cars, boats, yachts, and private jets.
Based on official government statistics, as of the end of February 2014, the total amount collected from the luxury tax has reached TWD 12 billion.
Photo by: Sundaram Ramaswamy