e-Tax alert 87 - Taiwan: VAT Act Amendments passed by the Executive Yuan to include foreign e-commerce businesses
Taiwan: VAT Act Amendments passed by the Executive Yuan
In August this year, the Taiwan Ministry of Finance (MOF) officially announced that it will amend the Taiwan VAT regulations regarding foreign e-commerce providers and bring them into the VAT net. Pursuant to the proposed changes, foreign e-commerce enterprises outside Taiwan that sells online to Taiwan individuals will be required to register and pay VAT in Taiwan.
Further to the announcement, the MOF had draft the proposed changes to the VAT Act and submitted it to the Executive Yuan. The amended draft VAT lawchanges were passed by the Executive Yuan on September 22. The draft proposal of the amended VAT articles will be submitted to the Legislative Yuan for its review and approvals. Pending the outcome from the Legislative Yuan’s reviews, further changes / clarifications may arise.
The main changes to the draft VAT Act to capture foreign e-commerce enterprises into the Taiwan VAT realm are summarized below:
Pursuant to the current draft proposal of amended VAT articles, there remain still a number of areas which require further clarification, such as the minimum VAT registration threshold, clearer definitions for foreign e-commerce enterprises and electronic services, requirement to issue government uniform invoices…etc. Additionally, based on the current proposed changes, there was no mentioning of any simplified registration or VAT filing regime, hence there would be an increase on the compliance requirements for foreign e-commerce businesses selling services to Taiwan individuals. Based on our prior experiences and comments given on the proposed VAT article amendments, we expect the MOF will provide further clarity in the subsequent issuance of detailed implementation rules and rulings. For businesses which could be affected should closely monitor the progress. KPMG will continue to monitor and track the developments on the VAT law amendments.
Partner, Tax department
Director, Tax department
© 2023 KPMG, a Taiwan partnership and a member firm of the KPMG global organization of independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved.
For more detail about the structure of the KPMG global organization please visit https://kpmg.com/governance.
上列組織及本文內任何文字不應被解讀或視為上列組織之間有任何母子公司關係，仲介關係，合夥關係，或合營關係。 上述成員機構皆無權限(無論係實際權限，表面權限，默示權限，或任何其他種類之權限)以任何形式約束或使得 KPMG International 或任何上述之成員機構負有任何法律義務。 關於此文內所有資訊皆屬一般通用之性質，且並無意影射任何特定個人或法人之情況。即使我們致力於即時提供精確之資訊，但不保證各位獲得此份資訊時內容準確無誤，亦不保證資訊能精準適用未來之情況。任何人皆不得在未獲得個案專業審視下所產出之專業建議前應用該資訊。