2023-05-15Guide to Taiwan Taxation System
1. Introduction | |
Taiwan's tax regulations provide different tax designations that accommodate to the rapid changes in industry and the rapid development of industry and commerce; there are clear regulations governing, for example, income taxes, business taxes, and customs tariffs. |
2. Classification by Taxpayer | |
Income tax is classified into consolidated income tax for individual taxpayers and profit-seeking enterprise income tax for profit-seeking enterprises. |
3. Individual Tax | ||||||||||||||||||||||||||||||||||
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4. Profit-Seeking Enterprise Income Tax | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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5. Customs Duty | |
Customs duty is imposed under the Customs Law and Customs Import Tariff promulgated by the MOF. Custom duty is imposed on imported goods, mainly on price basis, and also on quantity basis. |
6. Stamp Tax | |||||||||||
The stamp tax is levied on receipts of monetary payments, deeds for sale of movable property, contractual agreements, and deeds for real estate transactions.
The taxpayer is the person who signs or issues the taxable documents. If both contracting parties keep original taxable documents, each original would be subject to stamp tax. Thus, each party would be the stamp taxpayer for the original documents kept. |
7. Commodity Tax | |
The commodity tax is a single-stage excise tax levied on specific commodities, regardless whether those commodities are manufactured domestically or imported from abroad. |
8. Securities Transaction Tax | |||||||
Except for government bonds and other tax-exempted securities, all securities transactions are subject to securities transaction tax. Table 7: Tax Rates of Securities Transaction Tax
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9. Land Tax | |
Land taxes include the Land Value Tax and Agricultural Land Tax. The taxpayers are: |
10. Building Tax | |
Building and other construction, which increases the value of the buildings, are subject to building tax based on their assessed value. The taxpayers are: |
11. Land Increment Tax | |
Land value increment tax is applied to the unearned increase in the value of land, payable by the seller at the time of ownership transfer. The unearned increment is the difference between the official assessed value of the land at the time of sales and its official value of the land at the time of purchase. The taxpayers are: |
12. The Specially Selected Goods and Services Tax Act | |
With effect from 1 June 2011, Taiwan implemented the Specially Selected Goods and Services Tax Act, which imposes a luxury tax on certain selected goods and services including building and lands which are sold and possessed within two years, as well as high-consumptive passenger sedans, yachts, airplanes, helicopters and ultra-light vehicles, turtle shells, hawksbill sea turtles, coral, ivory, fur and its manufactured products, furniture, membership. Tax rate for the specifically selected goods and services tax is 10%. However, if the holding period for building or lands is less than 1 year, then the tax rate shall be 15%. |