The Legislative Yuan recently passed the KMT version of the bill, which will distribute NT$10,000 in cash to all citizens by the end of October. Today (17th), Premier Zhuo Rongtai came out to explain that the amount of over-taxation in recent years is about NT$1.8707 trillion, but after deducting the amount given to local governments, special funds, debt repayment, and special budgets for previous warplanes and the epidemic, the current available balance is NT$443.6 billion. If the KMT version is followed to distribute NT$10,000 to all citizens, another NT$101.4 billion in debt will be required. He also pointed out that the Legislative Yuan did not consult the Executive Yuan in accordance with the law and increased expenditures without authorization, which is unconstitutional.
The KMT version of the budget increased by NT$135 billion, and an additional NT$10,000 in cash was issued
It is reported that in response to the changes in the international situation brought about by Trump's tariff policy, the Executive Yuan proposed a draft (Special Act to Strengthen Economic, Social and National Security Resilience in Response to the International Situation) on April 24 this year. The original budget size was 410 billion yuan, covering three major aspects: national security resilience, economic and industrial support, and social support (Taipower subsidies, National Health Insurance and Labor Insurance Fund, and care for the disadvantaged).
In response, the three parties, Blue, Green and White, all proposed their own proposals, and the KMT version was finally passed with its numerical advantage. Unlike the Legislative Yuan version, the KMT version increased the total budget from NT$410 billion to NT$545 billion. The original NT$100 billion subsidy to Taipower was deleted, and replaced with a NT$10,000 cash payment to all citizens, which must be completed by October 31 this year.
The KMT Legislative Yuan caucus believes that the government should follow the example of Singapore and South Korea in distributing money to boost the economy
In response, the KMT Legislative Yuan caucus said that the central government over-collected NT$528.3 billion in taxes in 2014, and the cumulative over-collection in recent years has exceeded NT$1.87 trillion. It should follow Singapore's policy of giving each household NT$800 (about NT$18,000) in cash and South Korea's policy of issuing 400 billion won in consumer vouchers and 89.8 billion won in cash coupons in May to save the economy. The removal of the NT$100 billion Taipower budget subsidy is a request for the Executive Yuan to face up to its wrong energy policy.
Research by National Chengchi University professor Lian Xianming: Universal cash payments have the worst effect on revitalizing the economy
However, regarding the argument that giving out money can save the economy, Lin Zhijie, a distinguished professor at the College of Science, Technology and Law at National Yang Ming Chiao Tung University, criticized the fact that giving out money in the past was always well-supported, legitimate and hopeful in achieving its goals.
The reason why consumption vouchers were distributed during the presidency of Ma Ying-jeou was because of the 2008 global financial tsunami. The Council for Economic Planning and Development suggested using consumption vouchers in the hope that they would contribute to GDP.
During Tsai Ing-wen's presidency, the first time was when the global pandemic was raging, and she issued three-fold and five-fold coupons to help businesses in the hope of stimulating consumption. The second time was after the pandemic, considering that all industries needed to recover and fiscal control was appropriate, she compiled a budget to issue cash.
In this regard, Professor Lian Xianming of the Department of Finance at National Chengchi University also compared the policy effects of stimulating consumption after the issuance of the "Three-fold Stimulus Voucher" in 2020, the "Five-fold Stimulus Voucher" in 2021, and the "Universal Cash Payment" in 2023. The three-fold voucher that costs NT$1,000 is the most effective, the five-fold voucher is the second most effective in stimulating the economy, and the cash payment is the worst. Everyone saves it, which cannot revive the economy at all.
Lin Zhijie said: First, the Executive Yuan compiles the budget and the Legislative Yuan reviews it. Second, there are legitimate reasons, such as the financial tsunami or the global epidemic. Third, there are supporting measures, such as government subsidies in the form of double coupons, where people spend NT$100 to get goods worth NT$300, to revitalize industries or inject money into businesses and stimulate consumption.
She pointed out that the current policy of distributing NT$10,000 to all people, without excluding the rich, and a family of six living in a luxury house can receive NT$60,000, and there are no regulations on how to spend it or where to spend it, so that businesses can make money. People may just save it after taking it, which is of no help to stimulate the economy. She questioned the policy of distributing cash to all people, saying that it has no other purpose except that the KMT thinks it can save the recall vote on July 26.
Premier Zhuo Rongtai: A general loan of NT$230 billion would require a debt of more than NT$100 billion
Premier To Jung-tai said today (17th) that in terms of tax revenue from 2011 to 2014, the actual amount collected exceeded the budget by about NT$1.8707 trillion. However, after deducting the special budgets for local governments, transfer of special funds, debt repayment, and previous warplanes and epidemics, the current available balance is NT$443.6 billion. However, the special budget version passed by the Legislative Yuan includes general cash, the amount reaches NT$545 billion, and it is estimated that a debt of about NT$101.4 billion will be required.
Zhuo Rongtai also stated that according to Article 70 of the Constitution and Article 91 of the Budget Act, when the Legislative Yuan wants to use bills and budget bills to increase the expenditures of the Executive Yuan, it must first seek the opinion of the Executive Yuan, but the Legislative Yuan did not do so, so it is unconstitutional and illegal.
Wang Wanyu of the New Power Party: Firmly oppose the excessive cash flow that does not exclude the rich and does not clearly understand policy goals
In response, Wang Wanyu, chairwoman of the New Power Party, said that no matter which party it is, she firmly opposes the policy of universal cash payments. She believes that indiscriminate cash payments without excluding the rich and without clear policy goals are a waste of national resources and cannot stimulate the economy at all, but only to please voters.
She believes that this NT$230 billion can be used to do a lot of things, such as public childcare, public kindergartens, placement, social work, and poverty relief. However, the KMT has not thought of any of these things, and only thinks about spending money, buying votes, and saving recalls. She even criticized such a political party for not even being qualified to be an opposition party.
Shen Boyang: The budget-making authority and responsibility lies with the Executive Yuan
DPP legislator Shen Po-yang also criticized the KMT's actions from the perspective of constitutional divisions. He said that the Executive Yuan should govern according to the law, but the law is made by the Legislative Yuan; if the Executive Yuan has to implement whatever the Legislative Yuan does, then the country only needs the Legislative Yuan. This is why the Constitution stipulates that some powers and responsibilities belong to the Executive Yuan, not the Legislative Yuan. Budget preparation is the power and responsibility of the Executive Yuan. This is also why the Executive Yuan did take measures to distribute cash in order to revitalize the economy in the past, but this was not initiated by the Legislative Yuan.
This article is reproduced with permission from: (Chain News)
Original title: (Zhuo Rongtai: Universal issuance of 10,000 yuan requires a debt of NT$100 billion! Research shows that universal cash issuance is less effective than consumer vouchers)
Original author: Neo
"The controversy over the 10,000 yuan voucher is huge! Zhuo Rongtai: It needs to borrow 100 billion yuan, and research shows that the effect of the voucher is worse than that of the consumer voucher." This article was first published in "Crypto City"
