Foreign travelers will soon be able to apply for value added tax rebates amounting to NT$1,000 (US$31) or less directly when purchasing from authorized businesses, officials said.
The Executive Yuan’s Tourism Development and Promotion Committee on July 17 passed a proposal calling on the Ministry of Finance to make such a service available by revising related regulations. The service is expected to be implemented by the end of this year, sources said.
Currently foreign travelers visiting Taiwan must apply at the port of their departure within 30 days following the date of purchase to claim the refund of the 5-percent VAT paid on goods bought from Tax Refund Shopping-posted stores. This requirement often results in long lines at the nation’s airports.
The problem has become especially acute at Taipei City’s Songshan Airport since the launch of direct cross-strait flights to and from Shanghai Hongqiao International Airport last month, as the airport uses the same counter to handle both general services and VAT refund applications, leading to heavy congestion at peak flight times.
The Ministry of Transportation and Communications said the situation would improve when the new measure is implemented in October and the service counters at the airport begin to be used exclusively for customs affairs.
According to MOF officials, currently in countries around the world, tax rebates are handled in three ways, including commissioning a private company to deal with related matters, allowing businesses to offer the rebates directly, and having the government handle the rebates, with the last being the case in Taiwan at present.
The MOF said that if the method of commissioning a private firm were to be used, then foreign travelers normally would only receive about 68.5 percent of the tax rebate amount as the private firms would charge service fees.
MOF officials said as further analyses found that about 77 percent of the eligible claims for VAT rebates are for amounts of NT$1,000 or less, the ministry said it agreed to revise relevant regulations as soon as possible to improve the quality of tax rebate service. (SB)