Taiwan is making significant strides in the digitalization of its tax system with the recent amendments to the “Value-Added and Non-Value-Added Business Tax Act” (BTA). These changes, passed by the Taiwanese Congress, focus on refining the procedures for electronic invoices (e-Invoices), ensuring greater efficiency and compliance in the tax reporting process.
Key Amendments to the Business Tax Act
The revised BTA now mandates that all taxpayers must transmit electronic government uniform invoices (e-GUIs) along with all required related information to the Ministry of Finance’s (MoF) Integrated Service Platform. This platform will serve as the central hub for storing and verifying e-Invoices, providing a streamlined process for both businesses and the government.
Transmission Deadlines
Under the new amendments, the transmission deadlines for e-Invoices remain consistent with current practices, but the emphasis on compliance has been significantly heightened:
- B2B Invoices: Taxpayers are required to transmit e-GUIs within 7 days.
- B2C Invoices: For consumer transactions, the deadline is set at 2 days.
These deadlines align with the existing regulations under the Regulation Governing the Use of Uniform Invoices, but the BTA amendments introduce stricter enforcement and new penalties for non-compliance.
Penalties for Non-Compliance
One of the most critical aspects of the updated BTA is the introduction of new penalty provisions for failure to meet the transmission deadlines or for errors in the transmitted information. Businesses that do not comply with the new requirements could face fines ranging from TWD 1,500 to TWD 15,000. Moreover, if corrections are not made promptly or if the information provided is inaccurate, additional penalties may be imposed.
These penalties highlight the Taiwanese government’s commitment to ensuring accurate and timely tax reporting, underscoring the importance for businesses to adapt quickly to the new procedures.
New Message Implementation Guideline (MIG v. 4.0)
In addition to the BTA amendments, the Ministry of Finance has released the Message Implementation Guideline version 4.0 (MIG v. 4.0), which is now in effect. This new version introduces updated standards and procedures for transmitting e-Invoices, reflecting the latest technological advancements and best practices in electronic invoicing.
To assist businesses in transitioning to these new standards, the previous version, MIG v. 3.2.1, will remain valid until December 31, 2025. This transitional period allows companies to adapt to the new requirements without disrupting their operations, providing them with the necessary time to update their systems and processes.
Preparing for the Future of E-Invoicing in Taiwan
With these updates, Taiwan is reinforcing its commitment to a fully digitalized tax system, ensuring that e-Invoicing becomes an integral part of business operations. Businesses operating in Taiwan must familiarize themselves with the new amendments and the updated Message Implementation Guideline to remain compliant and avoid penalties.
The Ministry of Finance is expected to release further detailed implementation rules regarding the transmission procedures, issuance of e-Invoices, and specific information requirements. Staying informed and prepared for these changes will be crucial for businesses to successfully navigate the evolving landscape of electronic invoicing in Taiwan.
