Taiwan legislature passes amendment on pre-death gifts and estate tax

Taiwan's Legislative Yuan has passed an amendment to the Estate and Gift Tax Act, introducing a "big wife clause" that will proportionally tax gifts made within two years of an individual's death. This legislative move aims to curb tax evasion through substantial asset transfers before death.

The amendment stipulates that property gifted to specific relatives within two years prior to the deceased's passing will be subject to estate tax. The tax burden on these gifts will be calculated based on the proportion of the gifted assets to the total estate value. This measure is designed to ensure a fairer distribution of tax liability and prevent individuals from circumventing estate taxes by transferring assets during their lifetime.

Lawmakers passed the amendment on Tuesday. The new regulations are expected to impact estate planning and wealth transfer strategies for many Taiwanese families. The government hopes this change will enhance tax collection efficiency and fairness within the existing tax framework.