Nearly 40 percent of homeowners in Taiwan are expected to benefit from a revised property tax system after it takes effect, "Deputy Finance Minister" Chang Sheng-ford said yesterday.

Chang held a meeting with officials from cities and counties throughout the island to discuss a new five-tiered property tax plan that he said would be more fair and reasonable than the existing single rate system.

Currently, a residential property valued at NT$100 million is subject to the same 1.2 percent property tax rate as one valued at NT$3 million, he noted.

If the five-tiered tax system is implemented, about 40 percent of homeowners will pay property taxes of 1.1 percent, while owners of luxury or upscale homes will be subject to a tax rate of 1.8 percent.

Under this new tax regime, Chang said, about 58 percent of homeowners would pay property taxes at the same rate as before, while 3.44 percent of homeowners would pay a higher rate.

Meanwhile, the new plan would assess property taxes on commercial properties, such as offices, at a rate of 4-5 percent, a slight increase from the existing 3-5 percent.

A majority of land owners, or 97.22 percent, would remain unaffected under the proposed plan, Chang said.

Low property and land taxes have been cited as two of the factors sending housing prices soaring, particularly in Taipei City.

China Daily/CNA

(HK Edition 03/16/2010 page4)