On May 20, 2025, Taiwanese President Lai Ching-te celebrated a year in office. And while Lai’s speech, marking the milestone at the Presidential Office, presented a vision of cooperation with rival stakeholders, the second year of his presidency is off to a rocky start. If the recall campaign facing legislators of the two main parties – DPP and KMT – comes to fruition, it may be both a display of democratic vibrance, and indicative of volatility in the political corridors of Taipei.
Perhaps Lai’s biggest policymaking hurdle since the beginning of his tenure has been that his party, the Democratic Progressive Party (DPP), failed to achieve a majority in the legislative yuan. Of the 113 parliamentary seats, 52 were won by the DPP’s main opposition party, the Kuomintang (KMT), and 51 by the DPP. 8 seats were won by a third party closely aligned with major ideals of the KMT – the Taiwan People’s Party (TPP). The remaining two seats went to independent candidates who, again, are believed to be ideologically aligned with the KMT. Subsequently, the KMT has blocked vital steps to secure Taiwan’s internal democratic and legal processes, as well as its defence preparedness.
For example, in December 2024, the KMT pushed amendments to the ‘Act Governing the Allocation of Government Revenues and Expenditures’. The Act was amended for the first time in 25 years, and its new text restricted the central government’s budgetary decision-making powers, especially in the defence sector. Now, the central government is liable to disburse more funds to local governments, bringing the ratio of the central-to-local tax revenue share from 75:25 to 60:40, the pre-1999 amendment levels. Even the budget cut numbers, which are usually expected to be ~30 billion NTD, now stand at an unprecedented high of ~200 billion NTD.
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