2011-11-14
Proposed Amendment to the Tax Collection Act:
Taiwan’s Finance Committee of the Legislative Yuan has examined an amendment to the Tax Collection Act in late October of 2011. According to the proposed amendment, the collection of land value increment, land value, house and business taxes shall have priority over all claims and mortgages.
According to the Business Tax Act, where the assets have been sold by court auction, the company must pay the business tax. However, the collection of business taxes does not have priority over ordinary debts according to the Tax Collection Act. The Ministry of Finance has found that companies have been entering liquidation without having paid their respective business taxes. As a result, the Government has no option but to go after the responsible persons of suchcompany, most of whom had already been adjudicated bankrupt. This amendment to the Tax Collection Act has been proposed in order to address this situation.
For the time being, the Ministry of Finance announced that even if a new interpretative letter or directive is promulgated, until the final decision on this proposed amendment has been made, the more favorable, current provision shall be applicable to all case(s) currently pending final decision(s) in order to protect taxpayers’ rights and interests.
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