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Electric vehicle tax cut to be extended in Taiwan

Staff Writer | December 27, 2016
Taiwan approved plans to extend tax cuts for electric car sales by another five years to help electric car and parts makers grow and stay viable.
Taiwan electric cars
Green cars   Vice Minister of Economic Affairs Shen Jong-chin
The bill, which must still pass second and third readings, exempts electric motorcycles and cars valued at less than NT$1.4 million ($43,411) from sales tax from next month to December 2021 to boost sales.

The tax exemption was introduced in 2011 and was due to expire on Jan. 26.

Vice Minister of Economic Affairs Shen Jong-chin said that the extension is necessary to encourage the development and purchase of electric vehicles.

The tax incentive could increase electric cars sale by 5,939 units and electric motorcycles sales by 150,000 units over the next five years, or generate related industrial output by NT$94.39 billion, Shen said.

Governments abroad have introduced measures to boost electric vehicle sales because the vehicles are seen as more environmentally friendly.

Twenty-eight local firms are involved in the development and production of electric vehicles and parts, Shen said.

The expected increase in electric vehicle sales may help boost business tax by NT$4.36 billion a year, more than offsetting tax losses estimated at NT$2.4 billion per year, Minister of Finance Sheu Yu-jer said.