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The
structure of administrative
organization of the Taiwan Taxation
system |
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System of
administrative affairs |
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System of business supervision and
conduct |
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Executive Yuan |
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Fukien Provincial
Government |
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Kaohsiung /
Taipei City Government |
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Ministry of
Finance |
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Lienchiang County Government |
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Kinmen County Government |
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Finance
Bureau, Kaohsiung City /
Department of Finance, Taipei City
Government |
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Financial Data
Center |
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National Tax
Administration of Southern / Central
/Northern Taiwan Province |
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Taxation Agency |
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Kaohsiung /
Taipei National Tax Administration |
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Directorate
General of Customs |
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Training
Institute, Ministry of Finance |
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Taxation and
Tariff Committee |
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county/city
Government |
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Lienchiang County
Taxation Office |
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Kinmen County
Taxation Office |
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Revenue Service
Office, Kaohsiung City / Taipei
Revenue Service |
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Branch |
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Customs Offices |
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Revenue Service Offices |
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Taxation Section |
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Branch |
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Service Office |
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Taxation Office |
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Branch |
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Current Tax
System in Taiwan |
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The
tax system is also known as the tax
structure, which means a system of
tax composed of several relevant
components. For an individual tax
item, the components contained in
this item, such as the subject whom
the tax is imposed on, tax rate, and
method of imposition, will generate
a tax law, which represents the
system of such tax item. For
example, the income tax system may
be categorized into an income tax
system or a consolidated income tax
system. And business tax can be
categorized into a sales tax system
or a value-added tax system.
For the whole tax items of a
country, all of different tax items
form the entire tax system of the
country. The fairness and
reasonableness of the tax system of
a country depends on the content of
the structure existing in the entire
tax system of the country, such as
that whether the weight of central
tax and local tax appropriately
matches the function of each level
of government, and whether the
allocation of direct tax and
indirect tax is in line with the
distribution of National Income.
Then whether there is repetition or
impacts existing can be analyzed
from the structure for further
improvement. The current tax system
in Taiwan is divided into two
levels, which are national tax and
Municipal tax, in accordance with
Act Governing the Allocation of
Government Revenues and
Expenditures. The tax items of
second-level government are shown as
follows:
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Tax items of each level of
government |
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National
tax |
Income
tax |
Business
income tax |
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Consolidated income tax |
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Inheritance tax and Gift tax |
Inheritance tax |
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Gift tax |
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Commodity
tax |
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Securities transactions Tax |
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Customs |
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Mining
lot tax |
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Business
tax |
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Local tax
(County/City) |
Stamp tax |
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Vehicle
license tax |
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Land tax |
Farm tax |
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Land
value tax |
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Land
value increment tax |
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House tax |
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Deed tax |
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Amusement
tax |
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In respect to the
different characteristics of the tax
structure, it can be divided into
direct tax and indirect tax. A
direct tax is defined as the
taxpayer and the person who pays the
tax being the same one, which means
that the taxpayer is unable to
transfer the tax to any other
person. In case the taxpayer is able
to transfer the tax to other people
after paying the tax, the tax is
defined as an indirect tax.
Generally speaking, the progressive
tax rate is applied to direct tax.
People with higher income and more
wealth can afford more tax, and they
will pay more tax, which is for the
purpose of fairness and averaging
social wealth. The proportional tax
rate or fixed tax rate is commonly
applied to indirect tax. In this
case, the ability of affording tax
may not be equivalent to the ability
of paying tax. However, the indirect
tax is usually concealed within
consumption or prices, which makes
the tax be paid unconsciously and
taxpayers seldom feel any pain. Both
direct tax and indirect tax have
their own advantages. If the tax
structure of a country can comply
with its economic development stage
and the distribution of National
Income, the tax structure will be an
excellent system. But in practice,
except a tax which is not conscious
in advance, taxpayers always try to
evade or transfer the tax payable.
Therefore,
there are few taxes that can be
fully transferred. It is only
the issue of the level of difficulty
to transfer tax. The classification
of direct tax and indirect tax has
been used for a long time and is
continuously being used. |
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Under our current tax system, the
characteristics of each tax item
classified by the government are
shown as follows
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The
relation between taxation and
finance |
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The
generation of tax system can trace
back to the establishment of a
country. In order to constantly
operate and carry out various public
affairs, the country needs
substantial fund support. The source
of funds comes from tax revenue,
utility revenue, revenue from
government-owned property, monopoly
revenue, revenue from government
bonds and other public revenues. The
tax revenue is the key and most
stable source of funds. Therefore,
modern countries are axation
countries?in respect to the type of
finance. A ax country?is a term
commonly used in finance. The
meaning is that the revenue of
finance mainly comes from tax
revenue and tax is the core issue of
financial problems. We know that a
more modern government with more
ability can do more things for the
people. And in a more progressive
economy and a more modern society,
there are more things that the
people require the government to do.
The need that the people ask the
government to do more things and to
improve efficiency, the need of
protection of life and property
against external attack and internal
disarrangement, the need for
constant economic development to
improve the living standard, the
need of establishment of harbors,
schools, roads, and parks, the need
of environment protection, the need
for social welfare as well as others
are the causality that the country
requires its people to pay tax
according to applicable laws to
support its finances to carry out
public affairs.
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Direct
tax |
Income
tax |
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Inheritance tax and Gift tax |
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Securities transaction tax |
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Land tax |
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House tax |
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Deed tax |
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Mining
lot tax |
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Indirect
tax |
Customs |
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Commodity
tax |
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Business
tax |
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Stamp tax |
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Vehicle
license tax |
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Amusement
tax |
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