Sat, Dec 18, 2004 - Page 10 News List

Industry insiders suggest higher limit for online tax

By Joyce Huang  /  STAFF REPORTER

The Ministry of Finance may raise the threshold of NT$60,000 a month for online sales exempt from taxation to encourage the use of the Internet as a business channel, Chen Wen-tzong (陳文宗), deputy commissioner of the National Tax Administration in Taipei, said yesterday.

The tax administration yesterday held a public hearing to discuss the application of online taxation.

Tax experts, lawmakers and online auctioneers such as eBay Taiwan, Yahoo-Kimo Inc (雅虎奇摩), PC Home Online (網路家庭) and the state-run Chunghwa Telecom Co (中華電信) all took part in the discussion.

Most participants at yesterday's meeting argued that the NT$60,000 threshold, up to which online sales are free from taxation, is "too low to encourage the future use of the Internet as a new business channel," Chen said.

However, no consensus was reached on how high the threshold should be.

Chen said that his office will submit the meeting's minutes to the finance ministry's taxation department, which will establish a new cutoff figure.

Once the new figure has been hammered out, the implementation of online taxation will officially take effect.

Originally, the taxation administration was hoping that taxes could be levied on online transactions as early as May, but Chen said that the starting date for collecting tax from online transactions may be postponed, since law revisions will be necessary to incorporate the new threshold.

Participants at yesterday's meeting expressed opposition to the administration's proposal of levying taxes on servers based overseas.

Chen agreed that it would be very difficult for tax officials to trace overseas servers.

He said that overseas servers may not be relevant to the taxation discussion, because the administration only seeks to tax deals that are closed in Taiwan, no matter where the server is located.

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