21 January 2017
By Ying-Hsiu Lee/Taipei
The people of Taiwan demand legal and tax reform every year. Where on earth are the problems? We see that the public’s confidence in the judicial system has hit a new low, and both the government and the people are losers in such a situation. How many innocent people are crying silently due to the problematic systems? The Federation of Legal and Tax Reform and 14 other organizations held a forum titled “True Legal and Tax Reform: To Save Taiwan with Conscience” at the Lecture Hall of the National Sun Yat-sen Memorial Hall at 1:30 p.m. on Jan. 11. The meeting addressed the problems of the legal and tax systems through an analysis of the unjust Tai Ji Men criminal and tax cases. The unjust cases represent the serious problem of state violence against the people. A false accusation has led to the never-ending tax bills. That is outrageous! Before the Review Meeting of the ROC's Second Report under the ICCPR and ICESCR on Jan.16-20, the civic organizations held the forum to do a preliminary review of Taiwan government’s implementation of the Two Covenants. Legal and tax experts and scholars shared with the public their insightful perspectives on the violations of human rights by the government in the unjust Tai Ji Men criminal and tax cases and provided suggestions to the government. Approximately 300 people attended the meeting. The speakers addressed the problems that inhibit Taiwan’s development. What serious problems does Taiwan’s tax system have? What makes some experts even suggest abolishing the tax bureau?
Two videos were presented in the beginning of the forum. One is about the protest for legal and tax reform in 2016, where human rights organizations, scholars, experts, representatives of all circles, and victims of unjust taxation attended the protest and shared their thoughts. They had three appeals: Reject state violence, revoke illegal tax bills, and do justice to false and unjust cases. The media also paid attention to the “Rectify 1219” movement, which is about the Tai Ji Men unjust case that occurred on Dec. 19, 1996. This case has been considered a “landmark case of human rights” and a “typical case of disastrous taxation” because bizarre phenomena were seen in the case including the remnants of an authoritarian regime, the abuse of power by a prosecutor who fabricated evidence, the government using criminal and tax measures to persecute its people, and the tax bureau’s overriding the five branches of government. The other video shows a public hearing held by legislators in 2010 when Tai Ji Men members clearly stated that the monetary gifts they gave to the grandmaster of Tai Ji Men were truly gifts and many legislators showed their support of Tai Ji Men. The Tai Ji Men tax case has dragged on for 20 years and is called the “228 Incident of Taxation,” which has become a benchmark case of human rights.
Chung-Mo Cheng, the moderator of the forum and former chief justice and former vice president of the Judicial Yuan, said that Tai Ji Men is a well-loved organization and a place for people to cultivate their hearts. Over the past 20 years, the case has not been resolved during the terms of 4 presidents, 12-13 presidents of the Executive Yuan, 3 presidents of the Legislative Yuan and many legislators. He said that from the look in the eyes of the Tai Ji Men members, regardless of their age or gender, he can see their anticipation of fairness, justice, and the truth. 20 years have passed, and the government has failed to allow its people to see a fair and righteous result. This is a systematic problem and a problem in the administrative agencies. How come the government lacks the resolution to solve the problem? The court has made its final ruling over the tax issue, but how come the administrative agencies fail to solve the problem? The most important job of the administrative agencies is to make a decision and carry it out. But they dare not to make it. Are they going to let the people wait for 2 more decades?
Yao-Yuan Wen, former high court judge and speaker of the court, and also the presiding judge of the second instance of court trial of the Tai Ji Men criminal case, urged the government officials to think in the people’s shoes. He questioned how the government could bully its people with such abusive state power? When ordinary people suffer such state violence, they might just cry silently, but Tai Ji Men members step forward to fight for their rights and justice. The case has dragged on for 20 years. The government has owed Tai Ji Men an apology. He said that the tax agencies have failed to show respect for the rule of law. He also pointed out that the Speedy Trial Law stipulates that there is an 8-year limit for the commencement of a criminal case to its conclusion. The defendants of the Su Chien Ho case have been exonerated for three times, and that is final. People deserve a speedy trial when the government has a dispute with them; otherwise, justice delayed is justice denied. However, now the time limit of tax collection has been extended to 15 years. That is against the trend of the world. He said, “I don’t know if they have any concepts about law? They just do whatever they want? That is not the right attitude for the government officials of a democratic nation.” He urged lawmakers to amend the laws.
Judge Wen said the government has to treat its people with humility and kindness. Only laws cannot make the judiciary system work. We need conscionable officials and officers to enforce the laws. In Germany, besides administrative courts, there are tax courts (or called courts of finance), which are at the same level as high courts. Tax cases are tried in specialized courts for this purpose. The judges of the tax courts are selected from a list of eligible judges recommended by unions, associations, and other organizations, and people have trust in these judges.
Assistant Professor Men-Yan Tsai at the Department of Public Finance and Tax Administration of National Taipei University of Business, pointed out that taxation is powerful state power and especially needs to comply with the rule of law. Assistant Professor Tsai mentioned that he would ask his students to analyze the courts’ decisions and the facts involved when teaching tax laws. He encourages his students to think about the reasons behind the tax laws instead of calculating tax amounts only. For example, he asked his students what standardized deduction is. His students said that it is a tax deduction for people, and they failed to understand the costs involved in raising a child. He sincerely and sadly said, “When using entrusted power, the government officials must have adequate understanding of the law. Otherwise, collecting taxes from the people would be like haggling at a flea market. Then the government would become an organized body of criminals. If the government agencies don’t obey the law, how can they collect taxes from the people? If the government agencies don’t obey the law, how can they impose punishment on the people? They must show respect to the rule of law!”
The key issue in the Tai Ji Men tax case is the nature of the monetary gifts to the grandmaster of Tai Ji Men. The tax bureau has conducted open surveys to investigate the nature of the gifts. Assistant Professor Tsai mentioned that Articles 117 and 128 of the Administrative Procedural Law allow the administrative agencies to examine themselves and correct their mistakes. Since there are applicable laws, the administrative agencies can follow the law to revoke the erroneous tax bills. However, the tax agencies have had the authority but lack adequate understanding of the law. The case should not have dragged on for such a long period of time. It is truly a pity and a shame. He urged the Examination Yuan to reset its requirements for tax officers. Tax officers must have basic understanding of the spirit of tax laws; otherwise, they can be replaced by computers, said Assistant Professor Tsai.
Tian-Tsai Hsu, President of the Business Development Study, pointed out that the Tai Ji Men tax case originated from the documents transferred from the Prosecutors’ office. When a case is transferred from the Prosecutors’ Office, the tax bureau usually would issue tax bills to taxpayers without verifying the validity of the documents first. That has led to many unjust cases. Even when the court has confirmed that the defendants of a case are not guilty of tax evasion or violation of the Tax Collection Act, the tax case will not conclude there. The tax agencies would still force taxpayers to pay unjustified taxes while the tax agents involved would get bonuses. What would our country become with this kind of taxation practices? Unlawful prosecution has to be stopped from the judiciary system. Tian-Tsai Hsu is one of the victims of unlawful prosecution.
Tian-Tsai Hsu pointed out that the second problem in the Tai Ji Men tax case is that the administrative litigation keeps the taxpayers stuck between administrative courts and the tax agencies without getting any real remedy. Even when the judges in the administrative courts believe that the tax bills are unjustified, they dare not to make a final decision to conclude the case. Instead, the judges simply send the case back to the tax bureau for it to make another tax disposition. A tax officer would say that he is not the person that initiated the original tax bill and would not cancel it, either. Tian-Tsai Hsu said, “We must have the moral courage to do what is right!” He said that Tai Ji Men will definitely leave its mark in the history of the planet. The taxation in Taiwan still belongs to an authoritarian system and is absolutely not fair. No other nation in the world has a tax system like this, said Hsu.
Yi-Nan Chen, an arbitrator, stressed that there shouldn’t be any bonus for tax agents. Why hasn’t the Tai Ji Men case ended? Since the bonuses for the case have been given to the tax agents involved, how can the bonuses be retrieved? He pointed out that there are three major problems in Taiwan: the judiciary system, the police, and tax officials. The Tai Ji Men tax case has shown the problem of the abuse of power by tax officials. If we don’t get rid of these problems, what challenges would our future generations face? The Tai Ji Men tax case is derived from the Prosecutors’ Office, but no tax officer dares to shoulder the responsibility to cancel the tax bills. Taiwan is our country. The government agencies haven’t followed the law, and they let the case drag on and the innocent people suffer for 20 years, said Chen.
Attorney Chien-An Wang of Cheng-Yuan Business Law Firm pointed out, “The Tai Ji Men tax case has shown the government agencies’ violations of due process to the fullest extent. Surprisingly, Tai Ji Men has not given up. Many of my clients have given up after fighting for 5 or 6 years. Because of Tai Ji Men members’ efforts and hard work, Taiwan’s tax laws have improved today.” He said that 80% of the tax agencies’ investigations are illegal. It is stipulated in the Taxpayers’ Protection Law that any investigation by the tax agencies has to be in writing and the reason and scope of the investigation has to be specified. However, in reality, the tax agencies usually do not specify the reasons and scopes of their investigations throughout the years. “If a tax agent speculates that a taxpayer evades tax, the agent needs to have the reason and concrete evidence to justify an investigation. Nevertheless, tax agents often say, “I will issue you a tax bill first. You can seek a re-examination of the bill if you don’t agree with the tax demand.” However, if the tax bill is not cancelled, a prohibitory injunction will be imposed on the taxpayer’s property. Can the taxpayer accept that? Tax agents should walk in taxpayers’ shoes, said Attorney Wang.
Ming-Yi Wang, Associate Professor at the Department of Public Finance and Taxation of Takming University of Science and Technology, questioned why the Tai Ji Men tax case, which is a simple case of gift giving, cannot be resolved. She analyzed the case by looking at the procedure and the facts. She pointed out that the case should not have existed in the first place. Regarding the problem in the procedure, the tax bureau had issued a tax bill to Tai Ji Men before the criminal court gave its final ruling that determined the nature of the monetary gifts. Additionally, the tax bureau didn’t conduct an investigation into the matter before issuing the tax bill. Regarding the facts in the case, in reality, during the three instances of criminal court trials, the evidence and facts have been objectively and thoroughly examined. She pointed out that there is evidence showing that the monetary gifts to the grandmaster of Tai Ji Men are truly gifts. Even if there are taxable gifts when the amount exceeds the annual exclusion, the givers are responsible for the tax but not the receiver. This is common sense. How come the tax bureau doesn’t know it? She urged the tax bureau to cancel the illegal tax bills based on the evidence and facts. Tax agents must follow their conscience and bravely do what it right, said Associate Professor Wang.
Professor Ching-Hsiu Chen at the Department of Law of Soochow University said that the rise or fall of the nation depends on its citizens and that no one can live in peace when the nation is in chaos. He pointed out that there are many violations of due process in the Tai Ji Men tax case. In particular, the tax agencies don’t allow the taxpayers to read documents related to their cases that are held by the tax agencies. Then how can the taxpayers defend themselves? He said that he worked as a lawyer before 1999, and tax documents were accessible back then. However, 10 years later, the access was denied. Back in 1999, there was no Administrative Procedural Law, which stipulates that taxpayers are allowed the access to tax documents held by the tax agencies. Now we have the applicable law but are denied of the access. “The government is not being reasonable or sensible!” said Professor Chen. He urged the government officials and officers to listen to their conscience, to have compassion, and to be reasonable.
Professor Chen also pointed out that there should be a requirement for tax agents to pass the national exams on tax laws so that they will have adequate professional knowledge. Otherwise, it would be like a nation where medical doctors are not required to have medical knowledge and skills and the people are treated as “guinea pigs.” He urged the government to pay serious attention to this matter. He mentioned that for 10-20 years no new books have been used by the training courses for tax and finance officers. This shows little regard to the importance of tax laws. The tax bureau only places emphasis on how to collect more taxes but neglects justice in taxation. Now human rights in taxation are like a river that is completely dry. He pointed out that the judges in administrative courts dare not to make final rulings and need supporting measures. In the future, when tax courts are established, the problems are expected to be relieved to some extent.
Photo 1: In celebration of Law Day, a forum titled “True Legal and Tax Reform: To Save Taiwan with Conscience” was held, and legal and tax experts and scholars shared with the public their insightful views on the violations of human rights by the government in the unjust Tai Ji Men criminal and tax cases and provided suggestions to the government.
Photo 2: Chung-Mo Cheng, former chief justice and former vice president of the Judicial Yuan, said that the court has made its final ruling over the matter, but how come the administrative agencies fail to solve the problem? The most important job of the administrative agencies is to make a decision and carry it out. But they dare not to make it. Are they going to let the people wait for 2 more decades?
Photo 3: Yao-Yuan Wen, a former high court judge, said that when ordinary people suffer state violence, they might just cry silently, but Tai Ji Men members step forward to fight for their rights and justice. The case has dragged on for 20 years. The government has owed Tai Ji Men an apology.