Wed Feb 25, 2015
Taiwan recently has seen revelations of scandals since the newly elected took office. In January, Taiwan Control Yuan committee members conducted an annual review in the Executive Yuan. Chang Po-ya, President of the Control Yuan pointed out that the result of 9-in-1 election shows people's expectation on government is growing. The Control Yuan and Executive Yuan should encourage each other to meet people's expectation. Last year, the Control Yuan had passed 15 impeachment cases and 22 people were impeached. The number of cases that need corrective measures reached 114, signaling regulations are not in line with people's need that provokes public discontent.
Where does the discontent come from? The stock market value sharply declined by 2.2 trillion NT dollars because of collecting capital gains tax, one of the policies Finance minister, Chang Sheng-ford promoted. 80.3 billion NT dollars of securities transaction tax is undercharged according to Taiwan Securities Association data. Chang thus was elected as the winner of top ten villains. Taiwan Ministry of Justice data shows the number of arbitrary administrative enforcement in 2013 hit 4.9 million cases, indicating one fifth of Taiwan population owes taxes or dues. Taiwan's whistleblowing climate is also a cause for public discontent.
Sufferers of illegal tax collection filed a petition to a committee member of the Control Yuan on February 16, urging the Control Yuan to address the problems of illegitimate taxation.
Speaking of the Tai Ji Men tax case that remains unresolved for over 18 years, attorney Tsai Fu-Chiang called on the Control Yuan to be the watchdog. He asserted it is a persecution to a martial art group by authority. The case has been ruled with not guilty and no tax evasion, but tax agency still issues tax bills and even freezes asset based on the invalid indictment. “If it happened to a small business or an individual whose asset was frozen for over 18 years, could they possibly survive?” he added.
Tai Ji Men dizi put on a play of how the tax agency violated the principle of evidence. The play revealed the inter-ministerial meeting on December 9th, 2011 for resolving the case. Former Executive Yuan Secretary-General, Lin Join-sane, former Minister of Finance, Lee Sush-der, former Deputy Minister of Justice, Chen Ming-tang and former chief of Taipei Tax Administration, Chen Jin-jian attended the meeting.
The meeting came to a conclusion that the tax administration should bear the burden of proof according to Article 12-1 of Tax Collection Act, and should decide on the proper procedures of investigation. Under the consensus, both sides should follow the standard operating procedure. Then, the tax administration should publicize at home and abroad for 2 months to collect confirmations of the nature of Tai Ji Men dizi's monetary offering. If the result proved to be that of gift, then it should not be taxed based as per the stipulations of law. If anyone claims the offering as tuition, the case should be processed accordingly. As the result, all 7,401 declaration forms affirm that the offering is gift. The evidence is clear enough that the tax bill should be rescinded.
The tax administration issued a tax bill again when Chang Sheng-ford took office as the Minister of Finance. No one claims the money as tuition, but the tax administration said half of it is gift and the other half is tuition. It is an obvious violation of the principle of evidence. “The evidence shows none of the offerings is tuition. How could they say so?” Tai Ji Men dizi responded.
Another sufferer, from tech industry, is demanded repayment of tax for technology share. The consignor, Chen Shu-ting said “the litigant had technology share valued at 7 million NT dollars. The company went bankruptcy, and had reduced capital year by year. But the income is computed to be 70 million, so the litigant should pay 20 million tax.” His father passed away and his mother is seriously ill because they could not bear the pressure. He was diagnosed with tumor, so he cannot work. His friends help with his medical bills. The consignor added that the tax agency and administrative court should collect tax by substantive levy principle and proportionality principle.
Lee Yung-hsien, another sufferer of taxation sold his only house. He bought the house at 6.2 million NT dollars and sold it for 6.8 million, but was collected luxury tax for 1.02 million and requested to pay another 1 million for the fine because he didn't do household registration. He presented water and electricity bills to prove that he did live in the house, not speculating on real estate. He didn't make profit out of it, but still need to pay millions of luxury tax.
Giving red envelops is a Chinese tradition
Giving red envelops (monetary gifts) in Chinese New Year is a tradition as giving blessing. Giving monetary gift from dizi to Shifu is also a way to show respect. It is against Chinese custom and logic to tax the red envelops.
Tai Ji Men Qigong Academy is a traditional menpai of qigong and martial art, registered under Ministry of Interior and a group member of Taipei Taoism Society. Giving monetary gift to Shifu is similar to giving red envelops to parents on Chinese New Year, representing gratitude. For many years, Tai Ji Men dizi have deep guilt for making their Shifu's property ‘confiscated' because of the monetary gift.
The Tai Ji Men case has become a case study for human rights in many international academic seminars. Experts and scholars have given supports to Tai Ji Men to fight for justice. “Administrative institutes are for the people, not for the state revenue,” said Lee Hwai-Tzong, professor of Department of Law, Chung Hsing University. The authority and citizens have to follow the principle of taxation by law.
Passing down teachings from Shifu to dizi is an important and beautiful practice in Chinese culture. But the tax agency does not follow the principle of presumed innocence. They often negotiate with people on the amount of taxes and force people to pay. It is an intentional destroy of Chinese culture.
Tai Ji Men tax case was derived from criminal case. The criminal case has been ruled with not guilty, no fraud, no tax evasion and no violation of tax codes after 10 years and 7 months in court. The Control Yuan issued an investigation report that confirmed 7 major flaws of the Tax Administration in the assessment of taxes on Tai Ji Men.
Revelation the secret files of Ho Kuan-Ren's persecution on TJM
Eighteen years ago, on December 19, 1996, Prosecutor Ho ordered investigators and the police to do a big search on TJM. After over 20 hours of investigation on that day, he detained the Zhang-men-ren without any evidences. During the four months from the next day of detain, he only opened court session three times and just asked the Zhang-men-ren thirteen sentences, lasting for twenty-nine minutes in total. He handled the case without care and abused human rights at random. In comparison with the judgment of the court on the case of TJM injustice, the judges put on trial seriously for 58 court sessions and spent 9,570 minutes during the period of ten years and seven months. It apparently showed that the state power had been abused illegally by the bad prosecutor to make people and the country both losers.
This criminal case was transferred to the Taipei local court for trial on April 18, 1997. When the case was still under hearing, Prosecutor Ho exceeded his legal power by sending official notice to the ministry of home affairs on April 25, 1997. On May 21 of the same year, he continually sent the official letters to all the local cities and county governments, unlawfully charged TJM as an evil religious group and asked to seal off TJM Qigong Academies. When he knew that some events and activities were still held in the academies, on June 18 & 19, 1997 he dared to send illegal mails to the Public Works Department of Taipei City and Taipei County to ask for cutting the water and electricity supply. To be brief, he just wanted to carry out his order of dismissal and tired out Tai Ji Men dizis. Fortunately, through administrative remedies, the crises of the academy's being sealed off or dismantled could be lifted at last.
In March, 2002, the Control Yuan brought up an investigation report, pointing out prosecutor Ho Kuan Jen exceeded his legal authorities in handling Tai Ji Men case in 1996. He violated the principle of confidentiality in investigation, engaged in illegal search and unlawfully freeze personal assets, judged the case not according to scientific evidences, illegally demanded that the city and county governments seal off all the Tai Ji Men Academies, failed to inform the defendant's counsel to be present, questioned the defendant in an evil manner, etc. Therefore the Control Yuan sent notice to the Ministry of Justice seeking disciplinary actions against prosecutor Ho Kuan Jen. In addition, the Control Yuan confirmed that the case was prosecuted with obvious contradictions between statements made by some plaintiffs and evidences legally obtained through proper investigation. This was in violation of the principle of legal evidence and should not be prosecuted in the first place. However, it was unbelievable that the Taxation Bureau should impose illegal tax based on the incorrect information. What was even more ridiculous, when investigated by the Control Yuan, prosecutor Ho Kuan Jen himself confessed that he really made the mistake by sending official letters to the Ministry of the Interior and all the local cities and county governments to ask them to dismantle Tai Ji Men. He also admitted that he made the charge only according to the plaintiff's unreal charges and failed to make due investigations. What an obvious violation of law and abuse of power. The inaction of the Ministry of Justice was disciplined by the Control Yuan on December 15, 2010.
•The immediate revocation of the illegal tax bill which is unlawful and without ground in the first place
Experts of human rights assert that the Tai Ji Men case is a case of injustice, which obtained state compensation in 2009. According to the opinions of many scholars and experts, the Tai Ji Men case can be analyzed from different angles of law.
•The Tai Ji Men tax case is against the constitution
The Tai Ji Men tax case, having experienced 18 years of litigation, comes from the criminal case. The indictment assumed that the same amount of money was illegal fraud and should be confiscated. It was also regarded as the income of cram school tuition, and was taxed and fined illegally after being transferred to the National Taxation Bureau. This is against the protection principle in our constitution-- one crime, no double punishment.
•The illegal tax bill, which is against procedural justice, should be void from the beginning
The Taxation Bureau knows well about the contradictions of the two treatments of the same money in the bill of indictment. Besides, the court is still pending trials. The Taxation Bureau sent the illegal tax bill in 1997 without following the spirit of the legislation of administrative procedure law, article 177 and without waiting for the verdict to determine the nature of the money. It did not make the investigation according to its professional code of conduct or give the defendant any opportunity of making explanations. Without clarifying the basic facts, the income nature, or the amount of money, it even regarded Tai Ji Men as a cram school and imposed the illegal tax and severe punishment on Tai Ji Men Qigong Academy, just based on the false information and fabricated amount of money in the indictment. Our government gain and again orders that the Taxation Bureau should not impose tax only according to the transferred report, written record or indictment. Therefore, the Taxation Bureau violated not only this regulation but the right process of law, the procedure code and appropriateness.
The indictment referred to the red envelope which the Tai Ji Men dizis sent to their shifu as “the income of committing crimes,” not as general income. According to the law, there is no taxation from “the income of committing crimes.” As a result, such a tax case did not exist in the beginning, and the tax bill, in turn, was void at all.
•The tax bill should be revoked at once since there is no reason for taxation
Tax specialist, Mr. Shih Yueh-Sheng had never been to Tai Ji Men to make any on-site investigation, but committed perjury on April 9, 1997, falsely pointing that Tai Ji Men was a cram school and helping the prosecutor finish the indictment. Then in October, 1997, the Taxation Bureau regarded Tai Ji Men as a cram school and imposed the illegal taxation according to the false information in the indictment.
In 1999, the Ministry of Education issued statement that Tai Ji Men was not a cram school. In 2000, in the public hearing in the legislature it again testified that “Tai Ji Men is indeed not a cram school.” The representative from the Investigation Bureau pointed out that in the written report and paper that he sent out, Tai Ji Men was not referred to as a cram school. On November 17, 2004, the agent from Taxation Bureau of Taipei in the Taipei High Administrative Court said, “Tai Ji Men is not a cram school. And the accused, i.e., the Taxation Bureau of Taipei, is not denying the fact.” Furthermore, in August, 2012, for the first time the Taxation Bureau of Taipei confessed in the official document that Tai Ji Men was not a cram school.
Now that Tai Ji Men is not a cram school, the taxation basis, or tuition fee, on which the Taxation Bureau imposes tax, does not exist anymore. Therefore there are no issues of taxation. The Tax administration should actively revoke the illegal tax bill according to the Article 177 of Administrative Procedure Law to stop hurting the people, persecuting human rights, and wasting national public funds. In this way we can maintain the dignity of the national court and the judicial system.