Taiwan law imposing VAT on foreign online sales to consumers passes legislative hurdle

Taiwan’s Ministry of Finance (MOF) has announced that on September 22 the executive branch, or Executive Yuan, has passed a proposed law imposing VAT on supplies of cross-border electronic services made to domestic individual purchasers.

The measure will soon be presented to the Legislative Yuan for consideration, the MOF said.

The proposed law requires foreign sellers of electronic services to register and pay VAT or assign tax-filing agent to handle the matter.

The law is designed to correct competition imbalances between domestic and foreign sellers and also to prevent tax revenue losses, the MOF said.

The MOF said that in drafting the law, it referred to the OECD recommendations as well to similar laws passed in the EU, Korea, and Japan.

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