The Hualien County Council on Wednesday rejected a Hualien County Government proposal to continue collecting a special mining tax, citing concerns over the motion’s legality.
During an extraordinary session to review 66 county government proposals, which began on Wednesday and runs until Friday next week, the council rejected a proposal to renew an ordinance to collect a tax on mining operations that was designed to protect tourist attractions.
The ordinance, in effect since 2009, allowed the local government to collect taxes on all mining operations for four years.
The regulations were changed last year to require that the ordinance be renewed yearly.
The council’s rejection stemmed from objections to the tax raised last year by Fu An Mining Co.
The county government’s 2016 version of the ordinance contravened Article 4 of the Act Governing Local Tax Regulations (地方稅法通則), as it raised the tax rate in excess of 30 percent from the original rate, Fu An said.
The 2016 version had a rate of NT$70 (US$2.51) per tonne of mined ore, an increase of NT$60 from the previous ordinance.
The Taipei High Administrative Court ruled in favor of the company and the Supreme Administrative Court in January dismissed an appeal by the Hualien County Tax Bureau.
Council Legal Regulations Office Director Yu Yu-lin (余玉琳) said that the legality and propriety of the Hualien County Government introducing the ordinance at this juncture was questionable.
Fu An filed another administrative suit against the county after the local tax bureau did not issue a refund, Yu said.
Hualien County Tax Bureau Director Lu Yu-chih (呂玉枝) said that it would contest the council’s decision and seek a constitutional interpretation from the Council of Grand Justices.
Hualien County Council Speaker Chang Chun (張峻) said that although the council supports a mining tax, it must be implemented correctly, or it might become a large financial burden for residents if mining companies have to be refunded.
The ordinance’s failure to pass means that the county’s revenue would fall by at least NT$1 billion this year, the county government said.
This would affect funding for policies and destabilize the county’s financial revenue, it said, adding that it was the “darkest day” for Hualien County “since the promulgation of the Local Government Act (地方制度法).”
Hualien County Government Secretary-General Chang Yi-hua (張逸華) said that the goal of the tax was to cover the overheads for environmental protection operations, which mining operations make necessary.
The county government would continue to negotiate with the council in hopes of passing the ordinance, he said.
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