Taiwan’s Legislative Yuan passed the amendments to the Value-added and Non-value-added Business Tax Act (VAT Act) on 15 July 2024. The Act was promulgated by the president on 7 August 2024.
The Executive Yuan will announce the date when the law comes into effect, and the amendments will be implemented once the sub-regulations are established.
The amendments focus on ensuring that buyers can correctly deduct input tax, allowing consumers to quickly access and confirm e-invoices and query details of the transaction via the Ministry of Finance’s platform, and encouraging the issuance of government unified invoices (GUIs).
The amendments also aim to maintain the accuracy of the invoice database, detailing GUI winning numbers and transaction specifics, and to protect public interests in the uniform invoice lottery cash prizes. Additionally, the changes simplify reporting for certified public bookkeepers by facilitating access to input and output voucher data through the MOF’s e-invoice platform.
Under the amended VAT Act, Business tax (BT) is levied through two systems: The VAT system and the non-VAT (special BT) system.
BT is applicable to the sale of goods, service provision, and imports. When VAT is paid on purchases, it can result in either an input tax credit or a refund if the BT paid on purchases surpasses the BT collected.
Other main amendments:
- To issue an e-invoice, transferring of the information to the MOF’s e-invoice platform for certificate storage is required. Businesses issuing e-invoices must send e-invoices and necessary information to the MOF’s e-invoice platform within a set time limit.
- The Act also introduces additional penalties for failure to provide information. Businesses that fail to submit e-invoices or disclose information within the specified time frame, may be fined between NTD 1,500 and NTD 15,000 and asked to correct the issue within a specified period. Failure to correct or making mistakes in corrections can lead to additional fines.
- Certain terms and late payment fee calculation methods for overdue taxes will return to the Tax Collection Act’s specifications.
