Taiwan cuts commodity tax

Taiwans Ministry of Finance lowered the commodity tax on domestic gasoline and diesel fuel for six months, effective May 28. It was estimated that the policy will cost government coffers nearly NT$10.05 billion (US$330.95 million) before Nov. 27, the Chinese-language Commercial Times reported. The tax cut was aimed at addressing the impact of soaring oil prices on consumers, Minister of Economic Affairs Yiin Chii-ming said. Democratic Progressive Party (DPP) caucus whip William Lai said that the commodity tax cut and the Cabinets decision to use the costs for state-owned oil refiner, CPC Corp., Taiwan (CPC) as the basis for price adjustments would also benefit Formosa Petrochemical, a private refiner. After the tax cut, Lai estimated that the treasury would receive NT$9.7 billion (US$319 million) less in tax revenues in the next six months, whereas Formosa Petrochemical would make profits of nearly NT$7 billion (US$230.5 million) this year on the back of the governments policy. (June 2, 2008)