Starting next year, Taiwan would adjust income tax rates for multinational enterprises (MNEs) to align with the Organisation for Economic Co-operation and Development’s (OECD) global minimum tax framework, the Ministry of Finance said in a statement on Wednesday.
MNEs with operations in Taiwan would be taxed at 15 percent, up from the current 12 percent, the ministry said.
The taxes would take effect when the businesses file their taxes in 2026, it said.
Photo: Chang Chia-ming, Taipei Times
Small and medium-sized enterprises as well as large businesses with an effective tax rate of 15 percent would not be affected, it added.
According to the OECD, the new tax rules apply to any MNEs with consolidated annual revenues of more than 750 million euros (US$831 million) for any two fiscal years within the past four years. These companies would be subject to a 15 percent effective minimum tax rate wherever they operate.
This measure aims to reduce the incentive to shift profits to low-tax countries, while also conforming with the ability-to-pay principle, the ministry said.
Currently, 60 countries or regions around the globe have announced they would adopt the global minimum tax. These include Taiwan’s neighbors Japan, South Korea, Singapore and Hong Kong, as well as some of Taiwan’s main trade partners, such as EU countries and Canada, the ministry said.
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