The government of Taiwan plans to revise the capital gains tax on securities investments to make it simpler and generate greater levels of tax revenues.
The government appointed task force said the revision would boost the local bourse and it had reached consensus with the Ministry of Finance and the Financial Supervisory Commission on the move.
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Under current rules, capital gains made from transactions involving stocks traded on the Taiwan Stock Exchange may be subject to a 15% capital gains tax.
The current tax has failed to generate any revenues since it was enacted last year. Based on the ministry’s latest tax income data, revenue from the securities transaction tax in the first four months of the year declined 24.4% year-on-year to $703 million, its lowest level since 2005, because the average daily turnover of the local bourse was 30% lower than the government expected.
Under the proposed rules, the 15% 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% on transactions valued at above TWD1 billion, or to be taxed at 15% on the value of any capital gains made, according to taxationinfonews.com.
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