Taiwan moved to reduce corporate and personal income tax Thursday, as part of the government's efforts to help lift the sagging economy, officials said.
The government plans to lower the corporate income tax rate from 25 to 20 percent, effective 2010, the cabinet said after it approved the cuts during a meeting.
"The tax cuts will strengthen Taiwan's competitiveness, attract investments, and immensely help small- to medium-sized companies," deputy finance minister Chang Sheng-ford told reporters.
The tax cuts, pending parliament's final approval, will lead to an estimated loss of 80.8 billion Taiwan dollars (2.3 billion US dollars) in annual tax revenue, the cabinet said.
However, the move comes as the majority of tax benefits extended to companies, especially those in the electronics sector, are scheduled to expire at the end of 2009, boosting annual tax revenue by 148.3 billion Taiwan dollars.
Taiwan plunged into recession as the economy contracted a record 8.36 percent in the three months to December due to the global economic meltdown, and the economy was forecast to contract 2.97 percent in 2009, the government said.
The government plans to lower the corporate income tax rate from 25 to 20 percent, effective 2010, the cabinet said after it approved the cuts during a meeting.
"The tax cuts will strengthen Taiwan's competitiveness, attract investments, and immensely help small- to medium-sized companies," deputy finance minister Chang Sheng-ford told reporters.
The tax cuts, pending parliament's final approval, will lead to an estimated loss of 80.8 billion Taiwan dollars (2.3 billion US dollars) in annual tax revenue, the cabinet said.
However, the move comes as the majority of tax benefits extended to companies, especially those in the electronics sector, are scheduled to expire at the end of 2009, boosting annual tax revenue by 148.3 billion Taiwan dollars.
Taiwan plunged into recession as the economy contracted a record 8.36 percent in the three months to December due to the global economic meltdown, and the economy was forecast to contract 2.97 percent in 2009, the government said.
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