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Taiwan looking to extend electric vehicle tax exemption until 2025

EVs that cost less than NT$1.4 million currently exempt from commodity tax

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Electric vehicle charging. (Pixabay photo)

Electric vehicle charging. (Pixabay photo)

TAIPEI (Taiwan News) — The Cabinet approved a draft amendment to extend a commodity tax exemption for electric vehicles until 2025 on Monday (Nov. 15).

Under the current law, electric vehicles bought between Jan. 28, 2017, and Dec. 31, 2021, for less than NT$1.4 million (US$50,408) are exempt from the commodity tax, CNA cited the Ministry of Finance (MOF) as saying. The MOF said it had proposed the amendment because electric vehicle sales still only account for a small percentage of vehicle sales in the country.

The government hopes that by extending the exemption period it will encourage more consumers to make the switch to electric vehicles. The move is also meant to promote sustainable development in addition to working toward the country’s goal of reaching net-zero emissions by 2050.

According to the MOF, as of October, 430,000 electric vehicles have been exempted from the commodity tax. The exemption cost the government around NT$439 million in tax revenue in 2017, NT$539 million in 2018, NT$717 million in 2019, NT$2.1 billion in 2020, and 2.06 billion for the first 10 months of 2021.

The proposed amendment will now be passed on for approval by the legislature before it comes into force.