According to the regulations of stock exchanges and over-the-counter trading centers, warrant issuers should have a liquidity provision mechanism and adopt risk management measures for the warrants they issue, and establish and adjust safe-haven positions.

(file photo)

[Reporter Wang Menglun/Taipei Report] The Finance Committee of the Legislative Yuan will arrange to review the relevant draft amendments to the "Hedging and Downgrading of Warrants" tomorrow (29th). The version includes the proposals proposed by the Ministry of Finance and legislators.

According to the report issued by the Ministry of Finance, this amendment is expected to reduce the tax rate from the current 3 per thousand to 1 per thousand. The expected benefits are: "improving the quality of warrant market making", "creating a favorable investment environment", and "enhancing the liquidity of warrants". " and "Active Equity Market Transactions".

According to the current regulations, in accordance with the regulations of stock exchanges and over-the-counter trading centers, warrant issuers should have a liquidity provision mechanism and adopt risk management measures for the warrants they issue, and establish and adjust safe-haven positions.

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The report issued by the Ministry of Finance to the Finance Committee pointed out that the Financial Supervisory Commission suggested reducing the tax burden on warrant issuers to adjust the risk-avoiding position in order to improve the quality of their quotations and promote the development of the warrant market. For financial policy, a draft amendment to the "Partial Provisions of the Securities Transaction Tax Act" is proposed.

There are 4 key points in this revision. The first is to add the issuance of subscription warrants approved by the competent authority of the target industry. During the period from the listing or OTC listing date to the expiration date of the warrants, within 5 years from the effective date of this provision, the subscription warrants are sold to avoid risks. For stocks in special accounts, if the total daily transaction amount is within the necessary range for hedging, the securities transaction tax rate will be reduced from the current 3 per thousand to 1 per thousand; Sunset Clause", a non-permanent reduction.

The amendment also authorizes the Ministry of Finance to consult with the Financial Supervisory Commission to formulate sub-regulations on the criteria for determining the necessary scope of risk avoidance and other related matters.

Secondly, the additional tax collectors and securities dealers shall list the transaction details of the warrant hedging special account and send them to the tax collection agency within the prescribed time limit.

Furthermore, in response to the adjustment of the securities transaction tax rate for securities hedging stock trading, securities companies and taxation agencies must cooperate to revise the relevant operating system, and the Ministry of Finance must consult with the Financial Supervisory Commission to formulate relevant sub-regulations. The revised provisions will be 6 months after the announcement implement.

Fourth, delete the provision for the calculation and collection of overdue fees and the provision that tax collectors or securities dealers who fail to pay taxes within 30 days of the deadline will be handed over for compulsory enforcement, and return to Article 20 of the Tax Collection Law.

In addition, another legislator proposed an amended version of the law to include the stocks of "index investment securities" (ETN) safe-haven accounts into the scope of tax reduction; The overall development situation will be evaluated separately, and this amendment supports the version of the Executive Yuan.

The Financial Supervisory Commission believes that according to statistics, in 2022, ETN will only pay 4.76 million yuan in securities taxes for selling stocks in a safe-haven manner.

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