Taiwan has introduced an amendment concerning the rules governing taxpayers (including foreign for-profit entities) that apply for an exemption from income tax on royalties and technical service fees related to the manufacturing, technical service, and energy-generating industries.
The amendment concerns income related to patents, trademarks, technical know-how, and other licensed rights. The amendment applies retroactively from 1 January 2011, and therefore applies to both domestic and foreign for-profit entities that sign agreements after 1 January 2011. The amendment includes a provision that the tax exemption extends to patent rights registered by a foreign for-profit entity under foreign laws. However this exemption is limited to those patents used for the development of important industries or for key technologies that cannot be provided domestically or where domestic technology cannot meet domestic specification requirements.
