The Ministry of Finance has announced it is increasing the individual income tax's exemption, standard deduction, and salary deduction in response to rising commodity prices. Finance Minister Su Jain-rong says this adjustment will benefit both single and married filers.
Commodity prices have risen continuously as of late, and the statutory standard for adjusting tax exemptions has been reached. The Ministry of Finance has announced that the individual income tax's exemption, standard deduction, and salary deduction have been increased to NT$92,000, NT$124,000, and NT$207,000 respectively. This measure will take effect in May 2023 for 2022 income filings.
Su Jain-rong, Finance Minister: “If you compare it with the last adjustment, if the price index rises by over 3 percent, then it will be adjusted according to the increase. Both single and married households will benefit greatly.”
The Ministry of Finance estimates that based on the applicable tax rate of 5 to 40 percent, a dual income household with two children will pay NT$1,900 to NT$15,200 less in taxes. An unmarried tax filer will pay NT$750 to NT$6,000 less. Nearly the entire population will benefit. Meanwhile, the ministry is also cracking down on real estate speculation. It convened a meeting with the local governments of New Taipei City, Taoyuan City, Taichung City, Kaohsiung City, Hsinchu County, and Hsinchu City, which are areas where real estate prices are fluctuating substantially, to discuss the possibility of levying a hoarding tax on housing speculators. Kaohsiung, Taoyuan, and Hsinchu all said they are interested.
William Tseng, Legislator (KMT): “Which other cities and counties have confirmed that they will implement it?”
Su Jain-rong, Finance Minister: “ Kaohsiung. Mayor Chen just announced it yesterday. Hsinchu County and Hsinchu City are also following up, while Taoyuan City has already decided on 2.4 percent. Whether or not to offer a split rate is another issue. Our understanding is that New Taipei City is considering it.”
The current places that tax real estate hoarders include Taipei City, Yilan City, and Lianjiang County. The first reading of Tainan City's draft bill was recently completed by the Tainan City Council. The ministry says it will urge local governments to consider split rates based on actual circumstances. As for the possibility of lowering tariffs on bulk products due to inflation, the ministry said there are adjustment mechanisms for bulk product tariffs, business taxes, and commodity taxes, and the Executive Yuan's price stabilization task force is monitoring the situation.