Taiwan MOF Clarifies SME Corporate Income Tax Deduction for Specific Salary Increases

The Taiwanese Ministry of Finance May 1 clarified a corporate income tax deduction for small and medium-sized enterprises (SMEs) for specific salary increases. The clarification includes that: 1) SMEs increasing the average salaries of local “grassroots” employees with non-periodic contracts can deduct up to 175 percent of the salary not due to an adjustment in the statutory minimum wage, in the year of increase; 2) the deduction applies retroactively to Jan. 1, 2024, and is effective until Dec. 31, 2033; 3) the 2024 and 2025 average monthly salary cap for qualifying full-time or part-time employees is NT$63,000 (US$2,167), and the ...