Taiwan tax revenue surges on AI boom, record stock market turnover

BUDGET BEATING: In the first five months of this year, cumulative tax revenue soared NT$400.5 billion, or 39.2 percent, to NT$1.422 trillion, ministry data showed

By Chen Cheng-hui / Staff reporter

Tax revenue from securities transactions last month surged 288.95 percent from a year earlier to NT$70.4 billion （US$2.23 billion）, rising on an annual basis for the 10th consecutive month and representing a record monthly figure as Taiwanese shares and market turnover continued to set new records, Ministry of Finance data released yesterday showed.

The TAIEX last month surged 5,806.31 points, or 14.92 percent, marking its second-largest monthly increase, while the benchmark index closed out the month at 44,732.94, a record high, mainly led by contract chipmaker Taiwan Semiconductor Manufacturing Co （台積電） amid the artificial intelligence （AI） boom.

Average daily turnover of the local stock market rose to record-high NT$1.53 trillion last month, a jump of 285.61 percent from NT$390.7 billion a year earlier, the ministry said.

However, the outlook for the collection of securities transaction tax warrants observation, as the TAIEX is likely to consolidate at high levels in the short term, which analysts attributed to factors such as rising US Treasury yields, massive capital expenditure required for AI data center construction and already high valuations for AI-related stocks, the ministry added.

The TAIEX yesterday closed down 76.08 points, or 0.18 percent, at 43,149.46, as investors took cues from overnight weakness on Wall Street and news of renewed clashes in the Middle East.

In the first five months of this year, cumulative tax revenue from securities transactions totaled NT$248.7 billion, rising 167.42 percent year-on-year and marking the highest level for the same period, the ministry said, citing that average daily stock turnover surged 174.96 percent year-on-year to NT$1.093 trillion over the period.

Overall, the nation last month collected NT$577 billion in tax revenue, up NT$263.5 billion, or 54 percent, from a year earlier and the highest since August last year, the ministry said.

The growth was mainly due to increases of NT$166.9 billion in corporate income tax revenue, NT$52.3 billion in securities transaction tax revenue and NT$20.9 billion in business tax revenue, it said.

Commodity tax revenue posted the largest decline of NT$3.4 billion, while license plate tax revenue fell by NT$500 million, it added.

In the first five months of the year, cumulative tax revenue grew NT$400.5 billion, or 39.2 percent, to NT$1.422 trillion, as increases in corporate income, personal income, securities transactions and business taxes offset the decreases in revenue from commodity and land value increment taxes, the ministry said.

The January-to-May figure was 11.6 percent above the government’s budget for the first five months and was 36.1 percent of its full-year target, it said.