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Your guide to import duty and taxes in Taiwan

Business · 4 Mins Read

Your guide to import duty and taxes in Taiwan

According to Globe News Wire, the e-commerce scene in Taiwan is forecast to grow by 48.1% annually, reaching a value of US$1,661.1 million in 2022. The country mainly imports electronics, mineral products, machinery, chemicals, and base metals. An article published by Focus Taiwan stated that in March 2022, imports increased 20.3% to US$38.85 billion. This has increased the country’s total imports in the first quarter to US$105.46 billion.

According to Taiwan's Foreign Trade Act, any company registered with the Bureau of Foreign Trade (BOFT) is allowed to export or import goods. If you want to ship your goods to Taiwan, bear in mind that your goods may be subject to Taiwan's import tariffs as per the shipment’s value. If you are planning on importing goods into Taiwan, it is important to be aware of  Taiwan's import tax and the import duty rate that will apply to your goods.

How to calculate import duty and taxes in Taiwan

Taiwan imposes duties on imported goods, the amount of which depends on the tariff code of your product. In addition, Value Added Tax (VAT) of 5% is levied on most goods. Taiwan’s import duty on goods is calculated using the cost, insurance, and freight (CIF) method, which means that the tax calculated is based on both the import value and the shipping costs. The rate of duty ranges from 0% to 30% of the amount of CIF. To calculate the amount of import tax, you can use the following formula: Import duty = duty rate x (value of goods + insurance costs + transport costs)

It’s important to know the import tax of the imported goods as it will affect your total landed cost of the goods. The following costs will affect the payment of the goods’ import tax:  

  • Shipping costs: freight, packaging costs, and insurance of the shipment

  • Royalties and fees for licences

  • Charges for business commissions

  • Value of products or services provided by the buyer to the seller free of charge or at a reduced price to support the manufacture or sale of the imported goods for export

  • The profit the seller makes on the buyer's unwanted goods

In addition to import tax, other levies such as trade promotion tax, commodity tax, excise tax, and health welfare tax may also be imposed on imported goods.

Since January 2018, Taiwan has had a de minimis threshold of NT$2,000. A VAT of 5% must be paid for all goods exceeding this de minimis value.

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Types of Taiwan customs tariffs

Taiwan has three main import tariffs, namely general tariffs, preferential tariffs, and non-tariff barriers to imports.

General Taiwan customs taxes and rates 

As mentioned, Taiwan calculates import tax based on CIF. Under general tariffs, an importer must also pay 5% VAT and a trade promotion service fee of 0.04% of the CIF amount. Additional taxes that the importer may have to pay include commodity tax, tobacco and alcohol tax, port duty, and luxury tax of 10%.

Certain goods are exempt from VAT, these include goods supplied for export, goods sold in duty-free shops, etc.

Preferential tariffs

Under free trade agreements, importers can apply for preferential tariffs. Certain goods from Panama, Paraguay, Guatemala, Honduras, Eswatini, New Zealand, Nicaragua, El Salvador, and Singapore are exempt from Taiwan’s import tax. Certain goods from China which are listed in the Economic Cooperation Framework Agreement (ECFA) benefit from preferential tariffs, while goods from the least developed countries are exempt from tariffs.

Non-tariff barriers to imports 

It is prohibited to import certain products into Taiwan, some of these include products that will pose a threat to the environment and/or are of advanced strategic technology. Goods that come from certain embargoed countries are also prohibited from importation.

Are my goods subject to Taiwan’s custom tax?

All goods imported into Taiwan are subject to a 5% customs duty (VAT) if the total value exceeds the de minimis value of NT$2,000. In addition to goods that are below the de minimis value, there are certain goods that are exempt from Taiwan's custom tax, some of which include goods like laboratory equipment imported by institutions for research and education, or any item which is sold for charitable profits.

Start shipping internationally to Taiwan

Shipping overseas can be daunting, especially if it is for the first time. Working with a trusted and experienced logistics company will help minimise discrepancies and avoid delays in customs clearance by helping you simplify shipping documentation, as they are equipped with the necessary knowledge to assist you in all your queries regarding  import duty and taxes in Taiwan.

We also have more international guides, such as those on duty rates in China and Indonesia’s import taxes and customs regulations. Browse today!

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