Department of Finance

In the 2022 fiscal year, military and public servants had a 4% raise. Executive Yuan allocated full subsidies from the special centrally-funded tax revenues for the first-year salary adjustment. On June 1st, 2023, Executive Yuan announced a 4% salary increase for all national military and public servants in the following year. According to the Central News Agency's report on the increased budget for the salary adjustment, it will be included in the central government's total budget for the next fiscal year. As a result, many local authorities expected that the central government would fully subsidize the salary adjustment of 2024, following the precedent set in 2022, and undertake the planning for distributing the policy funds. However, the central government unexpectedly demanded that local governments bear half the burden. In response to the issue raised by council members, the spokesperson of Executive Yuan pointed out that "Taipei City received the highest allocation of centrally-funded tax revenues and general grants nationwide". However, the central government's support for local finances includes more than just general grants. The Taipei City government clarified this point.

Mayor Chiang, Wan-An stated that in the previous salary adjustment, the central government provided full subsidies, but this time, they only covered half, which imposed a significant burden on local governments, making it a situation where the central government treats while the local governments foot the bill. The Taipei City government spokesperson, Yin Wei, pointed out that this would inevitably lead to issues in raising funds and squeezing policy expenditures, unfairly placing the burden on hardworking military and public servants. How can this be endured？ The central government publicly announced a generous gift by declaring a 4% salary increase for public servants in 2024, but they want the local governments to foot the bill.

The claim that the spokesperson of Executive Yuan pointed out about " Taipei City received the highest allocation of centrally-funded tax revenues and general grant nationwide " is also not entirely accurate. Analyzing the overall distribution of central funds to local governments, including centrally-funded tax revenues and subsidies, based on the final audit accounts of 2021, Taipei City received NT$49.4 billion in centrally-funded tax revenues, which was higher than the other five municipalities. However, its subsidy income was only NT$17.3 billion, the lowest among the six municipalities, making a total of NT$66.7 billion, ranking third among the six municipalities. It shows that the central government did not allocate more funds to Taipei City. Based on the budget for 2023, Taipei City also ranked fourth in terms of the combined allocation and subsidy. As for 2022, the situation can be reviewed again once the final audit accounts are confirmed, and it will be apparent that the central government's financial support to Taipei City is not superior to other regions. (Refer to the attached table for details)().

Even when considering the proportion of central funds injection to total expenditure, the Taipei City government consistently ranked last among the six municipalities. Despite this, the Taipei City government remains committed to financial discipline, seeking ways to increase revenue while reducing expenditure, fulfilling its role as the capital city, and strengthening debt management. It timely repaid debts, reducing debts by NT$4.8 billion in the first half of 2023, bringing the actual outstanding debt from NT$89.8 billion when Mayor Chiang took office in 2022 to NT$85 billion. The city looks forward to the central government providing full subsidies to local governments for the 2024 salary raise, increasing subsidies to Taipei City, taking care of the local government, and fulfilling the central government's promise to make Taipei City's financial support the highest nationwide.