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TAIPEI: "Vice Premier" Eric Liluan Chu called for measures yesterday to broaden Taiwan's tax base with a subsequent increase in tax revenues.

Chu also said the administration needs to do more to secure "social justice and fairness" by adjusting tax policies, including revoking tax exempt treatment for military personnel and teachers, imposing higher taxes on expensive properties and luxury goods, and levying a carbon tax.

"The government, however, needs to continue communicating with taxpayers over these plans," Chu said during a meeting of the Executive Yuan's Tax Reform Committee.

The "vice premier" praised efforts made by the Tax Reform Committee over the past 18 months to simplify tax procedures for the people and raise the overall economic efficiency of the tax system.

He noted, however, that there is still room for the administrative team to broaden the tax base and improve social justice related to taxation.

Responding to a reporter's question on whether raising taxes will become a trend in the future, Chu said the government will not move to increase taxes at present, but will spare no efforts to make the tax system as fair as possible.

Also yesterday, "Finance Minister" Lee Sush-der said that taxes cannot be raised at present and will only be increased during a strong economy under the proper conditions, although Taiwan's tax revenue fell sharply this year.

Lee explained that the Executive Yuan's Tax Reform Committee has been unable to launch tax hikes during the past 18 months because of the economic downturn, which caused the sharp decline in tax revenue.

Hit hard by the global economic slump, Taiwan should be seen as a patient that needs to be cared for to regain its strength.

"What a patient needs most is to take medicine or get a shot. How can there be talk of raising taxes at this point in time? " Lee said in answering reporters' questions.

He noted, however, that the government's reluctance to raise taxes now does not mean it will not do so in the future.

As long as the economy is good and the conditions are right, the "finance ministry" will naturally follow the trend and raise taxes, he said.

Lee also said the government will take a long-term view of tax hikes. Although the number of tax categories has fallen since 2001, total tax revenue has still risen by NT$500-600 billion, he said.

Taiwan's net tax revenue in the first 11 months of this year totaled NT$1.43 trillion, a decline of 14.6 percent, the largest in its history.

Revenue from corporate and personal income taxes, which account for almost 50 percent of Taiwan's total tax revenue, was down 24 percent during the 11 month-period.

China Daily/CNA

(HK Edition 12/30/2009 page2)