Media reports have said that the government is planning to issue stimulus vouchers again to boost the economy, which has been hit hard by a COVID-19 outbreak. Premier Su Tseng-chang (蘇貞昌) reportedly named four business sectors as priorities for subsidies: dining, retail, hospitality, and exhibitions and performing arts.
As the government has lowered the COVID-19 alert to level 2, the plan would be welcomed by the marketplace and businesses. Stimulus vouchers are designed to spark consumption, and promote commodities and services, in the hope of revitalizing an economy.
Consider dine-in services and other food products: While psychological factors affect consumption, the high price of household necessities also makes people less willing to spend money. Data released by the Directorate-General of Budget, Accounting and Statistics showed that the consumer price index last month rose 1.89 percent from a year earlier, while the cost of major household necessities rose 2.57 percent — the biggest jump in two-and-a-half years.
Why are farm produce and meat, such as pork, vegetables and eggs, more expensive? The authorities have said that the COVID-19 pandemic has led to a decrease in shoppers at major wholesale markets, as well as a drop in bulk buying for meals at schools and government agencies.
However, as total market demand remains unchanged, some suspect that unethical business owners are taking advantage of tighter supply to raise prices and rake in huge profits. If that is the case, and if such businesses are eligible for stimulus vouchers, that would go against the policy’s intent.
Articles 3, 6 and 35 of the Agricultural Products Market Transaction Act (農產品市場交易法) say that those who monopolize the trade of agricultural products or manipulate prices can be fined up to NT$300,000 (US$10,687). Article 40 of the Fair Trade Act (公平交易法) says that business competitors that collude on prices, affecting trade and distribution, can be fined up to NT$50 million.
Chapter 19 of Article 251 in the Offenses Against Agriculture, Industry and Commerce (妨害農工商罪) says that those who deliberately hoard “basic provisions, agricultural products or other food-and-drink consumer essentials” and refrain from selling them in the marketplace can be sentenced to up to three years in prison and fined up to NT$300,000.
Unfortunately, those in charge are not pursuing such crimes.
If the proposed voucher plan follows the government’s Triple Stimulus Voucher program, where recipients paid part of the cost, there would be a legitimate quid pro quo, placing voucher use under the protection of the Consumer Protection Act (消費者保護法).
Finally, the government should not ask people to wait in line to collect stimulus vouchers, as crowds would risk a resurgence of COVID-19 infections before the economy could rebound.
Yen Ting-tung is a professor in Ming Chuan University’s Department of Financial Law.
Translated by Eddy Chang
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