Problems relating to Trade and Investment on Taiwan
9. Restrictive export/import trade, duty, and customs clearance |
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Issue |
Issue details |
Requests |
Reference |
| (1) High Import Duty | - On CBU motorcycles, Government of Taiwan (GOT) levies 20% import duty, which is too high for a country like Taiwan where its economic power has reached the level of developed countries. The high sales prices are one of the factors that have caused the dwindling domestic market for motorcycles. - The tariff rate on wristwatch is high at 5% ad valorem. - Member firm's subsidiary (MFS) of JBCTIF must manufacture products using parts imported from Japan in the market dominated by local industries. The high import duty levied on parts forms part of the cause for the debilitating competitive edge of MFS products. |
- It is requested that GOT reduces to 10% import duty for CBU motorcycles. - It is requested that GOT repeals the tariff on wristwatches. - It is requested that trade between Taiwan and Japan is liberalised, by repealing tariffs. |
- Customs Regulations and Provisions |
| (Action) - In February, 1997, pursuant to the Japan-Taiwan Agreement concerning the WTO accession, Taiwan committed to remove high tariff rates over 10 items of textile products, 5 items of motor vehicles such as engines, 3 items of mirrors, in total of 18 items. - By Taiwan's accession to WTO, the simple average tariff rate for agricultural produce in 2002 was reduced to 14.1%, and industrial products to 5.78%. Taiwan committed, after a transitional period (until 2004 for majority of the items and some of the motor vehicles and their parts until 2011), to reduce tariffs on the concession items down to 5.5% in average (4.15% on industrial products and 12.86% on agricultural produce). In 2007, the simple average tariff rate on all products was 5.8%, and on non-agricultural products 4.7%. - While tariffs are reduced on many products with Taiwan's accession to WTO, the total tax and duties are high on certain products when the tariff and commodity tax (domestic tax) are added up. (Example: Color Television Receivers - import tariff 10% + commodity tax 13%). - In April 2006, GOT increased the tariff rate of monitor TV to 10%, by the change of classification from computer display equipment of 0% tariff to video monitor. - GOT maintains the Tariff Quota System on motor vehicles, imposing high tariff rate of maximum 30% on imports outside the allocated quota. - On 29 June 2010, GOT and Mainland Area signed ECFA (Cross-Strait Economic Cooperation Framework Agreement), corresponding to FTA, agreeing to reduce or repeal import tariffs on 267-items as to Taiwan (concentrating on tariff rates in the range of 2.5% to 5%) and as to PRC on 539 items (concentrating on tariff rates in the range of 10% to 15%) within 2-years in 3-stages after enforcement under the Early Harvest Scheme finally down to zero percent. The 267-items as to Taiwan are as follows: -- Petrochemical products (42-items): Raw materials, special chemical goods, plastic raw materials -- Machineries (69-items): Industrial machinery, other machinery, and machinery parts -- Spinning (22-items): Cotton yarn, cotton cloth, nylon, etc. -- Transporting equipment (17-items): Bicycle (finished) and its parts -- Others (117-items): Precision machine parts, tool and die, metal products, rubber/plastic, electronic products, electric products, etc. - On 22 May 2011, the 1st Meeting was convened for Negotiation of Singapore-Taiwan Economic Partnership Agreement (ASTEP). - In May 2012, negotiation began on Taiwan/New Zealand Bilateral Economic Cooperation Agreement. - In August 2012, Cross-Strait Investment Protection Agreement was concluded. |
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| (Improvement) - Manufacturing industries in Taiwan will be exempted from tariffs on import of machinery & equipment used for development of new products, product quality enhancement, increase in production capacity, achievement of energy saving, promotion of recycling, and new technology not yet introduced to Taiwan. This measure affords benefits to business entities entering Taiwan with machinery & equipment not yet manufactured in Taiwan. |
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| (2) Tariff Gap from PRC Products under ECFA | - Due to ECFA between PRC and ROC, Tariff rates on PRC products are lower than on Japanese products. Removal of import duty is likely between ROC and PRC, while standards and specifications will get closer, so that products from Japan must compete against low priced PRC products. |
- It is requested that GOJ and GOT will conclude FTA between Japan and Taiwan. | |
| (3) Different Customs Different Duty Rates | - Customs clearance is difficult due to the difference in duty rates between Customs on identical products. | - It is requested that GOT takes steps to improve professional expertise of its customs employees. | |
| (4) Import Duty Levied on Pre-Shipped Personal Effects of Expatriates before their Entry in Taiwan | - GOT levies import duty on all personal effects of expatriates pre-shipped to Taiwan preceding the expatriates' own entry into Taiwan. | - It is requested that GOT (or Customs of Taiwan) repeals the measures levying import duty, where the circumstances on the left column apply. | |
| (5) Import License System | - Since 15 April 2002, GOT has compelled filing of Import Declaration (on 471- items). On 19 October 2004, GOT repealed the Import Declaration System (on 465- items) This decision is based on GOT's Trade Promotion Policy, and the shortage of steel products. The Import Declaration System was retained on the remaining 6-items (such as reinforcing bar and H-section steel) in consideration of the qualitative safety of the public construction work. |
- It is requested that GOT repeals the measures levying import duty, where the circumstances on the left column apply. | |
| (Action) - After accession to WTO, Taiwan plans to observe the GATT 1994 Agreement on import licensing procedures by substantially reducing the item 2 under "Note 1", execute automatic import licensing, and simplify and expedite the import licensing procedures. - Board of Foreign Trade renewed the Law to Regulate Compact Discs on 30 January 2002, and published the definition list for 12 items of the 2nd class. While 6 items, including injection-molding machines for optical discs, are added to the list, tools and molding dies for rubber or plastic injection or compressing molding machines are excluded from the list. To import items subject to the list, optical disc manufacturing certificate (ODMC) issued by the Investment Commission, Ministry of Economic Affairs (MOEAIC) is required. - (1) In August 2003, GOT liberalized import of 173 items of steel sheet, etc. in addition to the previously liberalized 72 items of billet, scrap, pig iron, etc. (2) On 19 October 2005, GOT extended the period of import liberalization from 31 December 2004 to 31 March 2005 on heavy/centre plate (thickness: 4.75-50). (3) On 19 April 2005, GOT liberalized import of thick plate (thickness: 50-150). (4) On 20 December 2005, GOT extended the period of import liberalization from 31 December 2005 to 31 March 2006 on 15 items of hot-rolled steel, wire rods, etc. (5) On 23 March 2006, GOT extended the period of import liberalization from 1 April 2006 to 30 September 2006 on 15 items of steel bar, wire rods, etc. (6) On 20 September 2006, GOT resumed import embargo on 15 items of steel bar, wire rods, etc. (7) GOT temporarily liberalized import of 15 items of steel bar, wire rods, etc. (8) On 28 September 2007, GOT extended the period of import liberalization from 30 September 2007 to 31 March 2008 on 15 items of steel bar, wire rods, etc. (9) On 1 October 2008, in order to respond to the steel material shortage, GOT liberalised import on certain steel products. |
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| (Improvement) - Pursuant to the regulations by the Board of Foreign Trade, application for ODMC is no longer required for old machinery used for wiring of railroad cars. - In April 2002, GOT announced to deregulate import control restrictions on certain engines for motor vehicles and electric cords. |
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| (6) Absence of Mutual Recognition System on AEO | - Taiwan and Japan have introduced Authorized Economic Operator (AEO) System, without, however, ratification of mutual recognition system (MRS). | - It is requested that GOJ and GOT will ratify MRS, which gives favourable measures to AEOs in the domestic markets of both Taiwan and Japan. | |
| (7) Complex Product Registration Upon Import | - GOT requires product registration on prototype samples imported for evaluation purpose. - Product registration procedures are vexatiously complex on import and distribution of medical equipment. |
- It is requested that GOT streamlines the import procedures on prototype samples imported for evaluation purpose. - It is requested that GOT repeals products registration renewal system, namely, like Japan, once registered no renewal is necessary. |
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| (8) Concern Over GOT's Executing Demand for Production of Certificate of Origin and Inspection Report | - Ministry of health and welfare, announcement of 28 October 2014 announced the following 2-strengthening measures under import regulation (the relative period of 60-days from 28 October 2014 is overdue already, and is now presumably under review. As of 22 January, however, no measure has been taken on both 2-issues. However, GOT recommends making advance preparation, as its implementation will begin immediately once decision is reached.): (1) Foods imported from Japan require acquisition of (prefectural) certificate of produce issued by public institution. (2) Fresh frozen fruits and vegetables, frozen fruits and vegetables, fresh frozen fishery products, dairy products, foods for infants and children, mineral water or drinking water/edible seaweeds and tea products, candies, biscuits, and cooked grain products, require acquisition of radioactive materials inspection report. [Issues confronting a member firm] A member firm supplies material such as fats and oil imported from Japan to western confectionary in Taiwan. The followings are anticipated problems: -- Best Before Dates (BBDs) are too short for the subject products. As a result, considering the requisite time for acquisition of certificates and test reports from public institutions, the remaining BBDs get too short. -- The products in concern are with high-mix, small-lot production features so that the acquisition cost of certificate and test report for each item threatens the profitability of the member firm. |
- Member firms are opposed to the two measures on the left column that tighten import restrictions. | - Ministry of Health and Welfare Announcement of 28 October 2014 No.1031303136(Left(1)) No. 1031303247(Left(2)) |
| (9) Delayed Confirmation Work of Master List for Duty Free Application | - Import duty is exempted on goods imported by electric power companies into Taiwan with certificate of Bureau of Energy (BOE), Ministry of Economics (MOE) for Non-Domestic Production in Taiwan (NDP), without however, confirmation of the time frame (the required work-time for the BOE's confirmation of the master list, confirmation point, etc.), concerning BOE's certificate of NDP. During the pendency of BOE's confirmation work, the applicant's temporary assumption arises for the vast amount of duty, pending completion of the NDP finding. | - It is requested that BOE/MOE promulgates master list preparation guidelines for application of tariff exemption, with the work-time within BOE for the confirmation work. | - Customs Import Tax Regulation, Article 84, Additional Note 12 |
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