萬國法律事務所

The Executive Yuan recently submitted a bill to the Legislative Yuan to amend the Income Tax Law to levy a Tonnage Tax. It is estimated that Taiwanese marine carriers may be able to reduce their tax burden by more than 50% if this bill becomes law. The bill is also expected to provide an incentive to further develop relevant marine shipping industry in Taiwan.

According to the bill, a marine carrier whose residence or principal office is in Taiwan or meets certain other criteria, may, after the approval of the Government authority, choose total shipping tonnage as the basis for its business income tax.

The bill stipulates that the income tax that will be levied on a vessel with a gross tonnage of 1,000 tons or fewer will be NT$ 57 for every net 100 tons; the income tax that will be levied on a vessel with a gross tonnage of between 1,000 to 10,000 tons will be NT$ 42 for every net 100 tons; the income tax that will be levied on a vessel with a gross tonnage between 10,000 to 25,000 tons will NT$ 27 for every net 100 ton2; and the income tax that will be levied on a vessel with a gross tonnage greater than 25,000 tons will be NT$ 12 for every net 100 tons.

The bill stipulates that once the carrier chooses total shipping tonnage as the basis for its business income tax, it will not be permitted to change for a continuous 10 year period, and said carrier will not enjoy other tax benefits or reductions under other statutes.