Taipei, April 26 (CNA) The planned tax on stock investments will indicate whether President Ma Ying-jeou keeps his re-election campaign promise to uphold equality and justice, an alliance of civic groups said Thursday, following the Cabinet's finalization of its capital gains tax proposal the same day.
The government must carry out its promise to levy capital gains tax on the principle of "ability to pay" and not compromise due to pressure from those who make big profits, said Wang Jung-chang, convener of the Alliance for Fair Tax Reform.
Otherwise, Wang said, the alliance has not ruled out organizing a large-scale rally in May to protest against the unequal tax system.
Moreover, if the stock gains tax cannot be imposed, taxing sellers according to actual selling prices in property transactions will be even less likely, since that will involve the greater interests of the real estate industry, Wang said.
According to Taiwan Labor Front Secretary-General Sun Yu-lien, conglomerates threaten to stop investing in Taiwan whenever labor law or tax reforms are brought up. They do not even bother to hide their greed and would rather be fined for violating the law than abide by it, Sun said.
When the local bourse suffered losses in the past, however, these enterprises asked the government to intervene, Sun criticized, adding that it is particularly detestable whenever the wealthy refuse to pay taxes on the money they have earned.
The civic groups also panned stock brokerage firms' opposition to the proposed tax, saying they were trying to mislead the public and investors into believing the tax would harm the market.
Meanwhile, also on Thursday, an official from the Taiwan Securities Association said that the higher amount that can be deducted from the proposed capital gains tax on stock investments will still not do the local stock market any good.
The new version simply "makes no difference and has no point" and it is "a very bad decision," said Chuang Tai-ping, secretary-general of the association.
Under the amendment drafts, retail stock investors will be levied a tax on any net annual gains over NT$4 million instead of NT$3 million proposed by the Ministry of Finance.
The Financial Supervisory Commission under the Cabinet, on the other hand, fully respected its decision, which it believed reflects a small part of public opinion, said vice chairman Wu Tang-chieh.
(By Eva Feng, Han Ting-ting, Lin Hui-chun and Kendra Lin)