Investigation on Income Tax System of Consolidated Income from House and LandTransactions―In-depth Interview Method

Based on the sayings of “Finance is the mother of civil affairs†and “Tax revenue is the context of national economy†, a healthy tax system based on the alternating utilization of central and local tax systems is essential for achieving the administration by law and tax balance. In light of this, the Ministry of Finance has proposed the improvement project of “Income Tax on the Consolidated Income from House and Land Transactions†. The third reading of “Amendment of Tax Act of Consolidated House and Land Taxation System†was passed by the Legislative Yuan on June 5th, 2015, and it was promulgated on January 1st, 2016. The purpose of this study is to investigate the content of “Income Tax on the Consolidated Income from House and Land Transactions†, including: 1. Is separate taxation a proper move? 2. Is the sunrise term appropriate? 3. Is it necessary to have the “anti-misuse†term? 4. The tax exemption ofNT$ 4 million? 5. The effectiveness of tax revenue after suspension of luxury tax (also known as special sales tax) and the adoption of income tax on consolidate income from house and land? 6. Is it feasible for allocate tax revenue for expenditures of residential policy and long-term care? 7. Is the income tax on consolidated income from house and land in compliance with the principle of proportionality? This study is based on in-depth interview method along with literature review method for data collection and analysis. The results of this study indicate that: a separate taxation system is not appropriate in terms of income redistribution; the opposing party believes that sunrise terms are not appropriate; in theory the anti-misuse term -non-voluntary factors tax rate is not necessary; all interviewees agreed on the tax exemption of NT$ 4 million ; and the income tax on consolidated income from house and land is not in compliance with the principle of proportionality from the perspective of tax revenue. Key Words: Consolidated incom;Real estate;Taxation System;Principle of Proportionality