The government has expressed its determination to relax and adjust regulations to adapt to the rapid transformation of the global economy. It hopes this will increase the nation's competitiveness, improve its economic structure and give local enterprises better access to international markets.
As a part of this effort, 785 regulations had been adjusted as of the end of July this year. The main focuses of the recent adjustments include facilitating investment and management for enterprises, simplifying customs procedures, safeguarding stockholders' rights and relaxing regulations on foreigners' stays in Taiwan.
The Executive Yuan indicated that the government has been adjusting relevant regulations in three stages. Priorities of the first stage include loosening restrictions on investments in the mainland, allowing mainland enterprises to invest in Taiwan's manufacturing sector, increasing direct cross-strait flights and loosening business visa restrictions for mainlanders. These measures have already had a clear impact on cross-strait economic exchanges.
The second stage aims at economic revitalization and industry transformation, especially in the six emerging industries (biotechnology, travel and tourism, green energy, medical care, high-end agriculture, and cultural and creative enterprises) and the service sector. The Executive Yuan is sparing no effort in its project to promote the development of the service sector while keeping regulations in line with the times. Relevant ministries are being requested to review and relax their regulations on industries under their jurisdiction and collect suggestions from those industries in order to remove investment obstacles and establish a business-friendly environment.
In this stage, the government plans to amend the Act for Industrial Innovation, the Income Tax Act and the Estate and Gift Tax Act, lowering the profit-seeking enterprise income tax from 25 percent to 17 percent and setting a uniform 10-percent tax rate for estate and gift taxes. It believes that these measures will greatly increase the incentives and activity of investors, boost industries and facilitate the adjustment of the economic structure. It also hopes to lower tax rates for commodity, individual income and futures transactions to create a tax environment with low rates and streamlined administration.
The third stage of deregulation is industry structure improvement, with the objective of creating better interaction and integration among industries to stimulate greater economic growth. Priorities are adding service value to the manufacturing sector, upgrading the technological and international competitiveness of the service sector and identifying and developing niches for traditional industries. Regulatory reform is also expected to create an environment conducive to the development of emerging and intelligent industries as well as key service industries.
In response to Premier Sean Chen's instructions, the Council for Economic Planning and Development has established a web-based platform to collect suggestions for legal reforms from citizens in order to continue advancing toward the improvement of industry structure as well as professional recruitment and retention through further deregulation.
According to the Executive Yuan, one major principle in adjusting legal regulations is speeding up Taiwan's integration with international legal standards. Hence, the Executive Yuan intends to bring the legal stances of different ministries closer together in a bid to spur overall economic growth. The cabinet hopes bringing the Taiwanese regulatory system in line with the rest of the world will make it more efficient and give the island a more open economy.