Families that hire foreign domestic caregivers are required to pay an employment stabilization fee of NT$2,000 (US$64) per month, or NT$24,000 per year, which is not tax deductible. Companies that hire migrant workers are exempt from paying such fees once they are reclassified as “intermediate-skilled foreign workers.” Even if they do pay the fees, the full amount is tax deductible. This policy is unfair to households.
The purpose of the employment stabilization fee is to protect the rights of foreign domestic workers and ensure social stability. Prior to hiring a foreign caregiver, household employers must first post job openings for local workers — they can only hire a foreign worker if no one applies.
However, Ministry of Health and Welfare data show that there are more than 1 million people in Taiwan with registered disabilities. Meanwhile, there is a shortage of tens of thousands of long-term care workers. Taiwanese caregivers are either unable or unwilling to take on full-day jobs. Thus, foreign caregivers fill a genuine gap in the labor market; they are not taking jobs away from locals. Household employers should not be penalized with employment stabilization fees.
In contrast, employers who hire intermediate-skilled foreign workers might actually crowd out job opportunities for Taiwanese workers, yet they are exempt from paying such fees and even allowed to hire additional migrant workers. While this policy aims to help industries retain talent, it effectively imposes a “caregiving tax” on families with elderly or disabled individuals, robbing the poor to benefit the rich.
It also forces highly educated Taiwanese, especially women, to leave the workforce to care for elderly family members or children, exacerbating talent retention issues. Although employers collectively pay more than NT$10 billion into the employment stabilization fund each year, the fund’s committee lacks representation from households who employ caregivers, and its decisionmaking and fund allocation processes lack transparency.
This is the Ministry of Finance’s double standard: The employment stabilization fee is a business expense for companies, but a living expense for households. The same exact sum is interpreted entirely differently.
President William Lai (賴清德) has acknowledged Taiwan’s pressing demographic challenges — from record-low birthrates and an aging population, to labor shortages and talent outflow. He has instructed the Executive Yuan to consider allowing families with at least one child under the age of 12 to hire foreign domestic helpers, in addition to proposing that the employment stabilization fee be raised to NT$8,000 per month. If the government aims to increase tax revenue from foreign domestic workers, it should simultaneously reduce or waive the monthly NT$2,000 employment stabilization fee currently paid by families employing foreign domestic caregivers.
The ultimate goal should be to fully open up the employment of foreign domestic workers without placing restrictions on the scope of their job responsibilities — whether they are domestic helpers hired to assist with childcare, cleaning or managing household chores, or domestic caregivers tasked with caring for elderly or disabled family members.
For families without children or elderly members that hire foreign domestic helpers purely to assist with general household chores, the policy could follow the model applied to factory employers — a higher monthly employment stabilization fee of NT$8,000 to control demand. Conversely, families raising children under 12 years old or caring for people with severe disabilities should be fully exempt from paying employment stabilization fees, so that both caregiving and household work receive adequate support, thereby allowing more Taiwanese to re-enter the workforce.
Families that are willing to take on the responsibilities of raising children and caring for the elderly could hire foreign domestic workers, as doing so would enable dual-income parents to return to the workforce. This would not only increase household incomes, but would also assist Taiwan in addressing the challenges of low birthrates and an aging population by both strengthening the labor force and stabilizing the economy.
If citizens are able to care for their children and elders with peace of mind while remaining employed, they can help the nation prepare for its future. Families should not be punished or regarded as depriving locals of job opportunities simply because they hire migrant workers.
The Ministry of Labor should implement the following actions to cultivate a happier Taiwan:
First, the government should stop collecting employment stabilization fees from households hiring foreign workers to care for household members with severe disabilities.
Second, it should completely relax restrictions on the hiring of foreign domestic workers and use pricing to distinguish between their job responsibilities — a fee of NT$8,000 should be applied for general household help, while no fees should be charged for childcare and elderly care.
Next, households that employ foreign domestic caregivers should be allowed representation in the employment stabilization fund’s committee, while fund usage reports should be publicly disclosed and its annual budget subject to review by the Legislative Yuan. This would ensure that the fund’s tens of billions of NT dollars benefit families requiring caregiving assistance, rather than subsidizing industries.
Finally, households should be given the same tax treatment as businesses. Employment stabilization fees and other related hiring expenses should be listed as itemized deductions on individual income tax, thereby restoring tax fairness for families with caregiving needs.
Hiring foreign domestic caregivers is not about stealing jobs from local workers; it is an unavoidable choice made out of necessity. Foreign domestic workers are not a luxury; they enable small families to free up their time and participate in the workforce. Abolishing employment stabilization fees for families hiring foreign domestic caregivers and adopting differentiated rates for other foreign domestic workers are steps on the path toward restoring fairness for all Taiwanese families and achieving true equity.
Heidi Chang is an assistant professor at I-Shou University’s International College.
Translated by Kyra Gustavsen
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