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Along with Taiwan’s the socio-economic changes in recent years, the up-souring of house price has made to the top of the social grievance list. As the Luxury Tax Law, implemented by our government, had gained the majority’s support before its imposition; it subsequently showed that the issues of rising house price and uneven distribution of wealth are not to be disregarded by our government in power. However, ever since the Luxury Tax Law was officially implemented on June 1, 2011, questionings has been gradually formed towards the fairness and effectiveness of this law, and its continuance, necessity, and legitimacy are now facing great challenges. Therefore, it is necessary to re-examine its formation basis and legislative issues and review its current state of practice in Taiwan. This study investigates whether the Luxury Tax Law is in compliance with the principle of fair tax through the perspectives of economics, finance, and tax laws as to prove it was not formed under the ability-to-pay principle but based on the expectations of national economy, environment, and social policies. Although it is not necessary for the Luxury Tax Law to reach tax equity, its continuance is upon the people’s judgment on the values of outcomes and tax fairness. Under the inspections of Constitutional Conformity in study, the Luxury Tax Law, except for some parts in violation with tax equity, is sufficiently maintaining the property of disadvantage groups and the fundamental right to live. It stills wins over fifty percent of people’s trust in perusing even wealth and social balance by restraining itself to a reasonable and non-excessive taxation. Nevertheless, in the process of criticizing and re-examination, the study had become aware of many hidden problems within the relative regulations, which contributed to the law’s poor performance after implementation. The government shall soon amend those flawed regulations relating to the Luxury Tax Law and propose a better and more feasible policy for establishing an even wealth society.
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