Guide to Taiwan Commodity Tax-Company Formation_Trademark Registration_Tax Service - Hong Kong CPA

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Guide to Taiwan Commodity Tax

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Guide to Taiwan Commodity Tax

1. Scope of Taxation
	Commodities list in the “Commodity Tax Act”, whether manufactured domestically or imported from abroad shall be subject to commodity tax in accordance with this act except as otherwise provided by any other laws. The commodity tax levies depend on the type of goods, and the applicable tax rate or tax amount is also different (non-progressive tax rate).

2. Taxpayer

The Commodity Tax is levied when the taxable goods upon departure from a manufacturer’s premises or when the imported taxable goods completed the customs duties payment. The following table shows the scope of taxation and responsible taxpayers under the commodity tax:

Scope of Taxation and Taxpayers under Commodity Tax
Scope of taxation	Taxpayer	Exception
Commodities manufactured domestically	Manufacturer
Commodities manufactured under consignment contract	Consignee (i.e. manufacturer)	If the consignor is a manufacturer of taxable commodities, the consignor can apply to be the taxpayer
Commodities imported from abroad	Recipient of the goods, holder of the bill of lading or holder of the goods

3. Taxable Commodities, Tax Rates, and Tax Amounts

Seven categories of commodities are subject to the commodity tax levied on an ad valorem or other specific basis. The following is a brief outline of the tax rates or amounts for each category of commodity:

Taxable Commodities, Tax Rates, and Tax Amounts
Category	Subcategory	Tax rates/Tax amounts
Vehicles	Sedans with less than nine seats (cylinder volume not exceeding 2,000 cc)	25%
	Sedans with less than nine seats (cylinder volume of 2,001 cc or more)	30%
	Trucks, buses and other vehicles	15%
	Motorcycles	17%
Rubber tires		10%-15%
Non-alcoholic beverages	Diluted natural fruit/vegetable juices	8%
Non-alcoholic beverages	Other beverages	15%
Flat-glass		10%
Electrical appliances	Refrigerators	13%
	Television sets	13%
	Air conditioners	20%
	Central air conditioning systems	15%
	Dehumidifirs	15%
	Video recorders	13%
	Record players	10%
	Audio recorders	10%
	Stereophonic systems	10%
	Electric ovens	15%
Cement		Up to NTD 600/MT
Oil and gas		NTD 690/MT for liquefied petroleum gas; NTD 110/KL- NTD 6,830/KL for others

4. Exemptions and Deductions
	Taxable commodities that satisfy the following conditions are exempt from commodity tax: (1) Raw materials used for manufacturing other taxable commodities; (2) Goods for export; (3) Goods for exhibition but not for sale; (4) Goods supplied for troop entertainment; and (5) Goods supplied directly for military use with the approval of the Ministry of National Defence. (6) Vehicles imported for use in technical research and development, special purpose vehicles equipped with devices for exclusive use in security control and/or sanitary activities, mail transportation vehicles, tractors equipped with farming equipment, cargo trucks/cars for exclusive use in farmland, and engineering vehicles not running on public roads. (7) Inner tubes, solid rubber tires, and rubber tires for use on man-powered/animal-powered vehicles and farming vehicles. (8) Pure natural fruit juice, fruit syrup, concentrated fruit syrup, concentrated fruit juice and natural vegetable juice which are in compliance with the national standards. (9) Dehumidifiers for use in factories. (10) Hand-carry type record players smaller than 32 centimetres. Commodity tax can be refunded or offset against tax paid on commodities or bonded commodities that satisfy the following conditions: (1) Export commodities; (2) Raw materials used for manufacturing export goods; (3) Unsellable goods returned to the manufacturer for reprocessing or for refining into similar goods that are subject to commodity tax; (4) Goods that cannot be sold due to damage; and (5) Goods that are physically destroyed in transit or in storage by fire or water, or other calamities beyond control.

4. Exemptions and Deductions

Taxable commodities that satisfy the following conditions are exempt from commodity tax:

(1) Raw materials used for manufacturing other taxable commodities;
(2) Goods for export;
(3) Goods for exhibition but not for sale;
(4) Goods supplied for troop entertainment; and
(5) Goods supplied directly for military use with the approval of the Ministry of National Defence.

(6) Vehicles imported for use in technical research and development, special purpose vehicles equipped with devices for exclusive use in security control and/or sanitary activities, mail transportation vehicles, tractors equipped with farming equipment, cargo trucks/cars for exclusive use in farmland, and engineering vehicles not running on public roads.
(7) Inner tubes, solid rubber tires, and rubber tires for use on man-powered/animal-powered vehicles and farming vehicles.
(8) Pure natural fruit juice, fruit syrup, concentrated fruit syrup, concentrated fruit juice and natural vegetable juice which are in compliance with the national standards.
(9) Dehumidifiers for use in factories.
(10) Hand-carry type record players smaller than 32 centimetres.

Commodity tax can be refunded or offset against tax paid on commodities or bonded commodities that satisfy the following conditions:
(1) Export commodities;
(2) Raw materials used for manufacturing export goods;
(3) Unsellable goods returned to the manufacturer for reprocessing or for refining into similar goods that are subject to commodity tax;
(4) Goods that cannot be sold due to damage; and
(5) Goods that are physically destroyed in transit or in storage by fire or water, or other calamities beyond control.

5. Computation of Taxable Value

(1)	Domestic Commodities
	For domestically produced commodities, the taxable value is the manufacturer’s selling price less any commodity tax that has been included in the price. Computation of taxable value: Taxable Value = Selling Price* divided by (1 + Tax Rate) *Business tax is excluded when calculating the selling price. Where the manufacturer produced the taxable commodity under a consignment contract and raw materials were provided by the consignor, the selling price is the selling price of the consignor.
(2)	Imported Commodities
	For imported commodities, the taxable value is the total value subject to customs duties.
(3)	Filing and Payment
	Manufacturers are required to file excise tax returns and pay tax due to the government treasury and authorities-in-charge, respectively, by the 15th of the month following the month the goods left the manufacturers premises. For imported taxable commodities, taxpayers must file with Customs and pay the commodity tax along with customs duties.

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All information in this article is only for the purpose of information sharing, instead of professional suggestion. Kaizen will not assume any responsibility for loss or damage.

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