Taiwan's Export Processing Zones: Strengths and Niches

Excellent geographical position

Centrally located in the Asia-Pacific region, Taiwan EPZs are the ideal location for multinational companies seeking an all-encompassing center for R&D, assembly, inspections, and distribution. Taiwan has the shortest average shipping distance to every major port in the region, and the island’s close proximity to Singapore, Hong Kong and Shanghai provides convenient access for integrating with major Asian markets.

Expedient Administrative Procedures

All procedures can be completed within Taiwan EPZs. The procedures include investment application, review, company registration, the issuing of plant/building permits, and customs clearance. The average time for customs clearance is 3.5 hours.

Preferential tax measures

• Reduced taxes for transshipment businesses where operators pay tax on 10% of revenue
• Tax incentives as stipulated in the Statute for Upgrading Industries
• Goods for export from EPZs are exempt from Commodity Tax
• Customs duty exemption on machinery and equipment, raw materials, fuel, materials and semi-finished products that are imported for private use, and finished products transshipped by trade/warehouse operators.
• Zero business tax on exported goods, exported labor, purchased goods
• Deed tax exemption on newly built plants in EPZs and buildings purchased from the EPZA
• Housing tax at EPZs half of normal rate (1.5 % vs. 3%)

Access to Local Markets

Goods from EPZs may enter the domestic market (Note: Goods sold domestically will be subject to local taxes after deducting added-value taxes)

Low Land Rent

Yearly rent at EPZs is approximately NT$400 per ping (3.30579 sq. m).

Flexible Operations Approach

Companies and businesses may set up either their headquarters or branch operations in an EPZ. Headquarters within an EPZ may also set up branch offices or subsidiaries outside the zone to handle production. (However, separate accounting departments for should be set up for both EPZ and non-EPZ branches).

Solid Foundation for Manufacturing Industries

The manufacturing sector is well established in Taiwan, and encompasses up, mid, and down-stream industries. A large number of foreign investors are already involved in manufacturing in Taiwan, with an established information network in place that eases access to further business opportunities. Costs for administrative, management and technical personnel in manufacturing are the lowest among advanced countries.

No Country of Origin Restrictions on Raw Materials

Raw materials and components used for production are not limited by their country of origin (including China), and can be immediately sent to processing after approval.

Convenient, Accessible Transportation

All EPZs are located near major airports, ports and highways.

Access to Complete Information Network

Taiwan EPZs provide a complete and accessible network of worldwide contacts and resources for manufacturers and companies.

Safe Environment

Security Facilities and fire and police squads are stationed within each EPZ to ensure safety and security.

Comprehensive facilities

Companies and manufacturers can meet their basic needs, as all EPZ premises have banks, tax bureaus, restaurants, welfare centers, healthcare stations, employee hostels, childcare centers and a variety of sports/recreation facilities.

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