Aiming to boost exports of textiles and other items, the Taiwanese Cabinet has approved the proposal of the Ministry of Finance (MoF) for introduction of tax rebates on import of several items that are used in the manufacturing of goods meant for exports.
A number of Taiwanese exporters need to ship in raw inputs and mechanical components from other countries, to support production of finished products in the country. Such imports are subjected to tariffs, which raise production cost and ultimately affect exports.
Hence, to reduce the burden of additional cost of Taiwanese exporters, the Government has introduced tax rebate for 1,269 products which attract tariffs in excess of 4.3 percent. These products largely belong to six sectors, including textiles and chemicals.
All exporters who use any of the 1,269 items in production of finished goods meant for exports would qualify for such a rebate. The total tax rebate is estimated to be around NT$ 435 million per year.
During the 2009 global financial crunch too, the Taiwanese Government had provided tax rebates to help the exporters. Considering the numerous adversities that the domestic exporters are confronted with during the current year, the Government has once again chosen to resort to the practice of offering tax rebates.
Taiwan's domestic export trade is confronted with several adversities like the bond credit crisis in the US and EU, coming into effect of the free trade agreement between Korea and the EU, crumpling of the global markets and the US economic slump.
Currently, 3,135 of 8,726 categories of goods imported into Taiwan qualify for tax rebates. The tax rebate amount averages to NT$ 1.5 to 2 billion per year, and touched NT$ 1.97 billion during last year.
The widened scope of tax rebates is seen to raise the competitiveness of exporters, particularly of the small and medium sized exporters, in the global market.
Fibre2fashion News Desk - India
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