Imports from Malaysia into Taiwan have increased at an annualised rate of 6.05% every year from 1995 to 2021.
Consequently, this indicates there is a strong demand for imports from Malaysia. To start importing goods into Taiwan, you need to know Taiwan’s customs duties and taxes.
Types of duties and taxes
There are two types of duties and taxes on imported goods into Taiwan. They are:
Customs duty
Taiwan levies customs duty on imports into the country valued above TWD 2000. Taiwan’s customs duty can range from 0% to 30% but averages 6.25%.
Value Added Tax (VAT)
Taiwan levies a standard VAT rate of 5% on imported goods valued above TWD 2000.
Commodity Tax (Excise Tax)
Taiwan levies Commodity Tax (Otherwise known as Excise Tax) on certain commodities specified in the Commodity Tax Act. Taiwan levies Commodity Tax on goods including rubber tyres, beverages, cement, plate glass, oil and gas, electrical appliances, vehicles and more.
Commodity Tax rates can vary from 8% to 30% on different goods based on their value or volume in some specific cases. Refer to the table below:
Type of Commodity | Tax rate |
Rubber tyres | 10% or 15% |
Beverages | 8% or 15% |
Cement | TWD 280 to TWD 600 per ton |
Plate glass | 10% |
Oil and gas | TWD 110 to TWD 6830 per kilolitre or TWD 690 per ton |
Electrical appliances | 10% to 20% |
Vehicles | 15% to 30% |
Calculating Duties and Taxes
Taiwan levies 3 types of duties and taxes. However, only customs duty and VAT apply to most imports. If your imports are mentioned in the Commodity Tax Act, your goods must pay commodity tax on top of Customs Duty and VAT.
Calculating Customs Duty
To calculate customs duty, you must identify the HS code for the goods.
Once you locate the HS code for your item, you can look up the duty rate applicable to the goods and start the calculation.
Example of Customs Duty Calculation
You are planning to ship 2000 Umbrellas, worth TWD 100 each to Taiwan.
Step 1: Multiply the Total Value of 2000 Umbrellas
2000 x TWD 100 = TWD 200,000
Step 3: Find the cost with CIF value added
Sum up the total value of 2000 Umbrellas with the insurance and freight costs and you will get the CIF value.
Let’s assume the Insurance and Freight costs are TWD 700. The calculation will be:
TWD 200,000 + TWD 700 = TWD 200,700
Step 3: Calculate the customs duty rate using the cost including CIF value
Multiply the CIF Value of 2000 Umbrellas with the identified customs duty rate. In this case, the customs duty rate is 6.6%.
TWD 200,700 x 6.6% = TWD 13,246.2
Hence, TWD 13,246.2 is the Customs Duty payable for 2000 Umbrellas worth TWD 100 each.
Calculating VAT
To find the value of VAT, multiply the VAT rate by the CIF value of the goods.
Example of VAT Calculation
Using the same example as above - sending 2000 umbrellas to Taiwan, each costing TWD 100, with a cost of insurance and freight (CIF) value of TWD 700.
Step 1: Multiply the total value of 2000 umbrellas
2000 x TWD 100 = TWD 200,000
Step 2: Find the cost with CIF value added
Add the Total Value of 2000 Umbrellas with the Insurance and Freight costs to get the CIF value.
TWD 200,000 + TWD 700 = TWD 200,700
Step 3: Find the cost with VAT charges added
Multiply the CIF Value of 2000 Umbrellas with the VAT rate. In this case, the VAT rate is 5%.
TWD 200,700 x 5% =TWD 10,035
Hence, the VAT payable is TWD 10,035.
Calculating Commodity Tax
To calculate Commodity Tax, multiply the value of goods by the tax rate.
Example of Community Tax Calculation
If you're planning to import plate glass valued at TWD 200,000 into Taiwan, simply multiply the value of the plate glass by the tax rate applicable.
In this case, a 10% tax rate is applicable.
TWD 200,000 x 10% = TWD 20,000
Hence, the Commodity Tax applicable to plate glass worth TWD 200,000 is TWD 20,000.
Duties Threshold
The duty threshold for imports into Taiwan is TWD 2000. Therefore, any imported goods above TWD 2000 are subject to duties and taxes.
Duties Exemption
De minimis is the only duty exemption for shipments from Malaysia to Taiwan, as there is no free trade agreement between the two countries.
This means that goods valued at less than TWD 2000 are exempt from import duties and taxes. However, items exceeding this threshold will be subject to duties.
Payment Method
There are 3 ways to pay duties and taxes on imports into Taiwan.
According to Article 6 of the Customs Act, the person who has to pay the customs duty is either -
- The recipient of the imported goods
- The holder of the bill of lading
- The person holding the imported goods
Import duties and taxes can be paid via:
Option 1: In-person
Walk in to the bank inside a local customs.
Option 2: Remittance
Transfer the sum of the banking accounts of the Treasury or Customs as instructed.
Option 3: Internet payment
Importers or exporters can use the internet and certification mechanism to inquire about the online customs duty payment through the CPT single window and process customs duty payment through the online payment method.
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.
