Taiwan to raise tax exemption, deduction thresholds in 2024
Date:2023-11-08
Taipei, Nov. 23 (CNA) Taiwan's individual income tax exemptions and standard tax deductions are to be raised in 2024, in time for the tax season in May 2025, the Ministry of Finance (MOF) announced on Thursday. In a proposal approved by the Cabinet Thursday, the MOF noted that through the end of October, the consumer price index (CPI) had risen 5.5 percent this year, exceeding the 3 percent threshold for adjusting tax exemption and deduction levels. As a result, the ministry said, individual income tax exemptions will rise from NT$92,000 to NT$97,000 (US$3,078). In addition, the standard tax deduction for single filers will be raised from NT$124,000 to NT$131,000 and from NT$248,000 to NT$262,000, according to the ministry. The special deduction for wage and salary earners and persons with disabilities, meanwhile, is to be increased from NT$207,000 to NT$218,000. According to the ministry, the combined tax reductions are expected to benefit 6.62 million households in Taiwan, and will lower government revenue by NT$17.5 billion. 2023 tax year adjustments Separately on Thursday, the MOF announced that the annual tax-deductible allowance for basic living expenses during the 2023 tax year will be raised to NT$202,000 per person, an increase of NT$6,000 from last year. At a 5 percent tax rate, the NT$6,000 increase in the allowance will provide an extra NT$300 in income tax savings for a single filer, or NT$1,200 for a family of four, the ministry said. Taiwan's 2017 Taxpayer Rights Protection Act stipulates that people should not be taxed on the amount they need to cover their basic expenses, which is set at 60 percent of median disposable per capita income in the preceding year. In 2022, the median annual income was NT$336,850. According to the MOF, the adjustment to the tax-deductible allowance for basic living expenses will benefit around 2.35 million households and decrease government revenue by NT$18.9 billion. Resource: https://focustaiwan.tw/business/202311230018
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