TAIPEI (Taiwan News) — New Power Party Chair Wang Wan-yu (王婉諭) warned Thursday that local governments will receive significantly more funding in the 2026 fiscal year while facing far less scrutiny than central government agencies.
Wang said the recently amended Act Governing the Allocation of Government Revenues and Expenditures will divert NT$1.4329 trillion (US$45.7 billion) to local governments, per UDN. She noted that while the Legislative Yuan typically cuts the central government’s annual budget proposals by 2.2%, local councils reduce their budgets by only 0.2% on average.
Open Fun (歐噴) founder Wang Hsiang-jung (王向榮) said Taipei has cut just 0.46% from its budget proposals over the past five years, while Tainan trimmed only 0.02%. He added that several municipalities fall below even that level, with Nantou, Hsinchu County, and Pingtung making no cuts for years.
Wang Wan-yu pointed to Hsinchu County as a major outlier, saying it stands to receive the largest increase in funding despite the county council not reducing a budget proposal in 21 years. She said that while budget cuts are not inherently necessary, the scale of reductions still reflects a council’s oversight capacity.
Wang Wan-yu encouraged the public to help monitor government spending through a new budget inquiry platform developed with NGOs.
The NPP previously weighed in on the ongoing dispute over amendments to the budget allocation law, criticizing both the central government and the opposition, per Z.Media. The party said the executive branch lost initiative by submitting its version of the amendment too late, while the opposition’s proposal risked creating an illegal budget.
The NPP called on opposition lawmakers to support the Cabinet’s reconsideration request and to withdraw their own version. It said both sides should reassign responsibilities between local and central governments before negotiating revenue sharing.
The NPP also criticized the opposition’s revenue split formula, saying it favors northern Taiwan, per Liberty Times. The party noted that Taichung, Hsinchu, Taoyuan, and Taipei would see an average funding increase of 60%, compared to 51% for Tainan and 49% for Kaohsiung.
The NPP warned that while the central government previously used general grants to balance regional development, new rules requiring those grants to remain at least equal to the previous year would limit that flexibility. Some scholars expanded on the NPP’s observations, questioning the necessity of providing general grants altogether.
Scholars noted that general grants share the same purpose as centrally allocated tax revenues: meeting the basic budgetary needs of local governments, per The Reporter. National Taiwan University Professor Ko Ke-chung (柯格鐘) said the previous revenue split was less favorable to local governments, making general grants a remedial tool.
Ko argued that there is room for debate over whether general grants must remain at their current levels. Tunghai University Professor Liu Chih-hung (劉志宏) added that local governments should primarily rely on local taxes and centrally allocated tax revenues, with general grants reserved for balancing regional development.
The NPP further cautioned that restricting the central government’s ability to adjust program-specific grants could allow local authorities to “cash in on central funding while doing little” to complete the projects they are meant to support. Feng Chia University Professor Chen Cheng-tung (陳盛通) echoed the concern and urged stronger oversight to ensure funds are properly used, per UDN.
Liu noted that under Taiwan’s current fiscal system, when local governments encounter financial trouble, the central government ultimately bears responsibility for resolving the issue.
