In 2006, The world’s richest 1 percent will own more than 50% of the world’s wealth.
Taiwan’s wealth is rapidly being concentrated in the hands of the wealthiest 1 percent at the top of the income pyramid, and this top 1% owns 14% of Taiwan’s total income!
The latest polls show that over 70% of the public believes that the critical factor in the gap between incomes was not effort or hard work but having the capital necessary to make (more) money with money.
With the help of family contacts and financial support, the bold use of leveraging, a wealthy individual’s real estate holdings can multiply many times over in just a few years.
Almost all Taiwanese agree that the wealth gap has grown wider in the recent past, but the government seems oblivious to the phenomenon.
One critical reason why such a phenomenon exists is that official statistics fail to accurately reflect actual income distribution.
For an entire decade, tax revenues from “salary income" have accounted for more than half of the total tax collected, while taxes on stock and property sales has accounted for less than 1 percent of tax revenues.
The efforts of Taiwan’s industries to upgrade their operations have also stalled, leading many companies to rely on cutting costs rather than creating value. This has made it nearly impossible for salary levels in Taiwan to rise.
Once, in the 1970s, Taiwan generated one of the highest levels of national income in Asia with the most equitable income distribution of any country in the region, a phenomenon referred to by the international community as the “Taiwan miracle."
Taiwan’s government must face its income distribution problems, starting by completely reforming the property tax system and raising worker pay.