2017-10-30

The Executive Yuan Approved Tax Reform Proposals

On October 12 LAI Ching-te, the Premier of Executive Yuan, has approved tax reform proposals which include an increase in three types of Individual Income Tax Deductions, an increase in the tax rate of the Enterprise Income Tax and an alternative way to treat the individual dividend income tax.

The deductions to be increased are Standard Deduction (110,000 NTD), Special Deduction of Income from Salaries/Wages (180,000 NTD) and Special Deduction for the Physically or Mentally Challenged Person (180,000 NTD). The maximum tax rate of Individual Income Tax would also be reduced from 45 percent to 40 percent.

Also, taxpayers can choose a flat rate of 26% for their all dividend income. Alternatively, they may also treat their dividend income as normal income and enjoy a deduction of 8.5% of the dividend income amount, up to a maximum of 80,000 NTD.
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