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Taiwan collects $378m tax reveneu since 2011

Taiwan collects $378m tax reveneu since 2011

TAIPEI: A total of NT$12.5 billion (US$378.73 million) in tax revenue has been collected from land and housing transactions through the luxury tax since it was introduced in 2011, government statistics released yesterday showed.

Over the past five years, 2013 and last year saw higher luxury tax revenue, with NT$3.6 billion and NT$3.18 billion respectively collected in tax revenue from land and housing transactions, the statistics showed.

The goal of the luxury tax is to cap market speculation.

It has helped stabilize the housing market, said Tseng Chin-der, a manager in Sinyi Realty Inc’s research department.

The luxury tax is to be removed next year, when a new tax is to go into effect.

Introduced in 2011 in an attempt to keep housing prices in check, the luxury tax levies a 15 percent sales tax on second homes sold within one year of purchase and a 10 percent tax on properties sold between one and two years after they were bought.

In conjunction with the removal of the luxury tax, lawmakers have passed amendments to the Income Tax Act to curb speculation by imposing a maximum 45 percent capital gains tax on people who sell homes within one year of purchasing them.

The new integrated housing and land tax is to come into force on Friday next week.