Head of Taiwan’s central bank Perng Fai-nan says that he supports proposals to increase wages by amending a series of laws. He was speaking at the legislature on Thursday.
The proposal would see changes to the Company Act, the Factory Act, the Labor Standards Act, and the Small and Medium Enterprises Development Act.
Changes to the first three laws would require companies to implement a profit sharing plan or face fines that could approach US$160,000. The proposed amendment to the Small and Medium Enterprises Act, meanwhile, would allow companies to deduct 130% of wage increases from their business income tax.
Perng told legislators that traditional thinking expects the government to lower taxes and companies to reduce costs before wages can rise. He said that falling income-to-GDP ratios around the world over the past few years show that this thinking is false.
Perng said that business owners should care for their employees as well as their shareholders, raising wages to spur economic growth.