Vice Premier Mao Chi-kuo today presided over a meeting of the fiscal health task force to discuss actions for improving the government's finances and to examine various pressing expenditures items.
The government's budget deficit currently stands at around NT$270 billion (US$9 billion) per year, indicated Executive Yuan Spokesperson Sun Lih-chyun, and it was decided at today's meeting to cut the central government's budget by NT$45 billion (US$1.5 billion) in 2015 to narrow this gap.
The Executive Yuan said the nation's growing deficit problem can no longer be ignored, and that the issue must be addressed in a responsible fashion for the sake of Taiwan's long-term interests. As such, the MOF has proposed a fiscal reform plan, which was approved by the Executive Yuan. A fiscal health task force—led by Vice Premier Mao and comprising the Directorate-General of Budget, Accounting and Statistics, the Ministry of Finance (MOF) and the National Development Council—was also established under the Executive Yuan to oversee the plan's implementation. Sub-units under the task force tackle revenues and expenditures issues.
The MOF is proposing short-term adjustments to the taxation system by amending the Value-added and Non-value-added Business Tax Act and the Income Tax Act, which are expected to affect financial institutions' business tax and the integrated income tax system, respectively. The two draft amendments were approved at the 3,389th Cabinet meeting held earlier today and will be sent to the Legislative Yuan for further review.
Today's meeting mainly focused on pressing issues such as obligatory expenses, basic operational needs, as well as profit and nonprofit special funds of the central government. Agencies were also requested to study these issues internally before coming back for further discussion within two weeks, when the necessity of each expenditure item will be re-examined using zero base budgeting principles. The task force hopes to help improve the nation's fiscal health and invigorate its economy, noted the Executive Yuan.