Taxing times in Taiwan
The Taiwanese government completed their first review of the revised draft of the country’s luxury tax and, according to reports, legislators in the southern city of Kaohsiung have complained, stating that the owning of yachts should be removed from the amendment.…
The Taiwanese government completed their first review of the revised draft of the country’s luxury tax on 10 March and, according to reports, legislators in the southern city of Kaohsiung have complained, stating that the owning of yachts should be removed from the amendment. They uphold that Kaohsiung is a world-renowned centre of the nation’s yacht building industry and that the revised tax mechanism would dampen the sector’s development.
The luxury tax in question, which applies only to domestic buyers, has been in place two-and-a-half years and imposes a 10 per cent tax on boats worth over 100,000 USD. However, finance minister Chang Sheng-ford revealed that only a total of 243,000 USD has been collected from deals involving six yachts since the luxury tax has been in place. This has led to speculation that the tax has significantly hindered yacht building in the area.
Legislator Huang Chao-shun, who represents the city of Kaohsiung, said the manufacture and sale of yachts is expected to become increasingly profitable in the southern port city as new ports are established, but the luxury tax could change all that. Democratic Progressive Party legislator Bi-ling said that just at the marine business was about to boom, the government’s new tax mechanism killed it.
KMT legislator Lai Shyh-bao, however, is alleged to have insisted that there should not be any changes to the tax mechanism at the moment, stating that the yacht sector should not be subject to favouritism as this would be unfair on the other industries.
In a written statement, John Lu, president of the Taiwan Yacht Industry Association and CEO of Horizon Yacht, urged the president to put an end to the listing of yachts as luxury goods. “Unlike property or luxury products which can be used to make speculative profit, yachts should be thought more as a consumer product,” he commented. “Additionally, this industry creates jobs and is an integral part of Taiwan’s development and the growth of the recreational marine industry.”
The luxury tax in question, which applies only to domestic buyers, has been in place two-and-a-half years and imposes a 10 per cent tax on boats worth over 100,000 USD. However, finance minister Chang Sheng-ford revealed that only a total of 243,000 USD has been collected from deals involving six yachts since the luxury tax has been in place. This has led to speculation that the tax has significantly hindered yacht building in the area.
Legislator Huang Chao-shun, who represents the city of Kaohsiung, said the manufacture and sale of yachts is expected to become increasingly profitable in the southern port city as new ports are established, but the luxury tax could change all that. Democratic Progressive Party legislator Bi-ling said that just at the marine business was about to boom, the government’s new tax mechanism killed it.
KMT legislator Lai Shyh-bao, however, is alleged to have insisted that there should not be any changes to the tax mechanism at the moment, stating that the yacht sector should not be subject to favouritism as this would be unfair on the other industries.
In a written statement, John Lu, president of the Taiwan Yacht Industry Association and CEO of Horizon Yacht, urged the president to put an end to the listing of yachts as luxury goods. “Unlike property or luxury products which can be used to make speculative profit, yachts should be thought more as a consumer product,” he commented. “Additionally, this industry creates jobs and is an integral part of Taiwan’s development and the growth of the recreational marine industry.”
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