Foreign tourists to recieve VAT refund on departure: MOF

Beginning next month, foreign travelers will be refunded the 5 percent value-added tax (VAT) in a bid to boost the nation's ailing tourism sector, the Ministry of Finance said yesterday.

The Statute for Tourism Development (觀光發展條例) has been revised to allow the VAT to be refunded to foreign tourists who spend in excess of NT$3,000, the ministry's taxation department said in a statement.

The tax-refund policy aims to help double the nation's foreign tourist arrivals from 2.6 million to 5 million by 2008, the statement said.

According to the ministry, Taiwan hosted 2 million foreign travelers in 2001, who generated NT$600 million to NT$800 million in VAT revenues for the government's coffers.

After the policy kicks off next month, the government may lose a minimum of NT$800 million each year. But the tax loss will be relatively small, the ministry said.