Local tax legislation means that the local government designates its own local tax category, prescribes its own tax, and executes the tax assessment rights. Local taxation independence has great impact on the finance and development of the local government and has become a prevailing international trend of thought in recent years. In Taiwan, local governments commonly face the problem of tax assessment shortage due to general economic slowdown in the past few years. Increase of government spend worsens the finance of various levels of local governments. The fact that the local governments in Taiwan are spending more money than what they take in causes the annually increased deficit budget. In addition, the merge and upgrade of five cities this year will definitely cause expelling effect on the income of local governments. Therefore, the tasks of increasing revenue and cutting spending should not be further delayed by the local governments. Local government financial independence is one of the crucial factors ensuring local autonomy business publicity. Therefore, the study of legal causes and reforms of local government tax income shortage, especially the study of local tax legislation that directly affecting tax assessment, is an important issue for safeguarding local government financial independence and local autonomy. This study is a detailed analysis of issues based on local government legislative precedents and literature reviews. Using the information collected, this study analyzes the differences and similarities of practical and academic views, conducts in-depth interviews of experts in this field, and thereafter presents conclusions and proposals. The soundness of local tax legislation can not be achieved without the maturity of democratic concepts, local autonomy consciousness, time and environment. Expanding tax sources can be done in two ways at the same time. First, nationwide local tax shall meet the principles of sufficiency and stability of taxation. Specifically, an overall review on the current local tax system should be conducte, including the revocation of unreasonable tax reduction and increase of publicly announced land prices. By doing so, we can meet the finance demands from local governments. Second, local government can create new taxes that meet the principle of equity, neutrality, and benefit-receive. Specifically, local government can impose taxes with designated purposes of use, establishing the link between people¡¦s interests and burdens and meeting the special demand of local government finance. Combining these two ways shall solve the problem of insufficient tax assessment.