2018-11-19

Offshore E-commerce Enterprises Required to IssueE-Invoices

In response to an increasing number of offshore e-commerce enterprises offering electronic services in Taiwan, and in order to ensure the fairness of tax collection, Taiwan's Ministry of Finance (MOF, 財政部) has begun since 2017 to instruct offshore e-commerce enterprises to complete tax registrations and pay business taxes in Taiwan. The MOF also ordered that from the year of 2019, all offshore e-commerce enterprises issue e-invoices. The MOF, however, added that offshore e-commerce suppliers will be exempt from any penalties for not issuing invoices by 31 December 2019.

Domestic e-commerce enterprises has long complained that offshore e-commerce businesses have for a very long period of time been selling electronic services without paying any taxation. In response, the Taiwanese government amended the "Value-added and Non-value-added Business Tax Act" (加值型及非加值型營業稅法), to mandate that from 1 May 2017, all offshore e-commerce enterprises doing business in Taiwan must file a tax registration and pay the taxation, as long as their annual revenues exceed NT$480,000.

According to the National Taxation Bureau of Taipei, the Ministry of Finance (the “NTBT,” 財政部臺北國稅局), as of 25 October 2018, the Bureau has received and approved 94 applications for tax registration made by offshore e-commerce enterprises.

In addition, the NTBT advised that according to Taiwan's "Regulations Governing the Use of Uniform Invoices" (統一發票使用辦法), which was amended in 2018, offshore e-commerce enterprises are required to issue e-invoices from 1 January 2019. Nevertheless, given the uniqueness of Taiwan's uniform invoice system and the MOF's need for an additional period of time to prepare a multinational platform system interface for those multinational enterprises, offshore e-commerce enterprises will not be fined for failure of issuing e-invoices until 3 December 2019.
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