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Tax Law Violations & Punishment

Penalty Provisions

In order to ensure the collection of taxes, the Government, in exercising its power to govern, shall impose sanctions according to the gravity of each case against any violation of obligations under the tax law Unless otherwise provided in relevant tax laws, the Tax Collection Law has the following important provisions regarding penalties:

A.

A taxpayer who has, by fraudulent or other illegitimate means, evaded taxation is liable to no more than five years in prison , penal servitude and/or up to NT$60,000 in fines.

B.

A tax collecting or withholding agent who has, by fraudulent or other illegitimate measures, failed to report, under-reported, under-collected, or failed to collect or withhold any tax, is liable to no more than five years in prison, penal servitude and/or up to NT$60,000 in fines. A collecting or withholding agent who has misappropriated any tax collected or withheld is liable to similar penalties.

C.

Whoever aids and abets in committing the crimes under A and B above shall face up to three years in prison, penal servitude and/or up to NT$60,000 in fines. Any collection authority personnel, awyers, accountants or other legal agents committing such a crime in conducting their business shall face punishment aggravated by up to 50%﹒

D.

A profit-seeking enterprise which, by law, should offer someone or obtain from someone a voucher or retain a voucher but has failed to do so shall be fined 5% of the amount ascertained to be involved in the unissued, unobtained or unretained voucher.

E.

Failure to set up an account where, by law, there should be one, or failure to make entries therein in accordance with law, is liable for a fine of no less than NT$3,000 and no more than NT$7,500, and also to an injunction that the account be set up and records be kept in accordance with the law within one month. Failure to do so before the expiry of the one month period shall find the party liable for a fine of no less than NT$7,500 and no more than NT$l5,000, and also to an injunction that the account be set up and records be kept within the next month. Failure to do so is punishable by suspension of business until the account in question is set up and records are duly kept. In case a taxpayer fails to send the account to the tax collection authority for identification and seal in accordance with the law, he shall be liable for a fine of no less than NT$l,500 and no more than NT$I5,000 and also to an injunction that the account be sent to the tax collection authority within a period of time assigned. Failure to do so before the expiry of that period of time shall be subject to another fine continually until the account in question is sent to the tax collection authority. If a taxpayer fails to conserve the account or to keep the account in the place of business without any justifiable cause, he shall be liable to a fine of no less than NT$15,000 and no more than NT $60,000﹒

F.

A taxpayer who refuses to be subject to investigation by, or to supply relevant information to the tax collection authority or an investigator appointed by the Department of Taxation of the Ministry of Finance is liable to a fine of no less than NT$3,000 and no more than NT$30,000.A taxpayer or a legal authorized agent who, without any Justifiable cause, refuses to appear to b

G.

Serious cases of tax evasion shall be dealt with in accordance with the provisions of relevant tax laws and the Ministry. of Finance may further suspend treatment to encourage the taxpayer in question. The above penalty rules do not cover the whole body of sanctions against default of tax obligations, particularly violations of behavioral obligations which are dealt with in separate tax laws. The administrative fines are acted on by the tax collection authorities. A taxpayer who, because of negligence or ignorance of tax laws, has underpaid or failed to pay any tax but has since reported and paid the tax retroactively of his own accord to the tax collection authority before he is prosecuted or subjected to investigation by an investigator appointed by the collection authority or the Ministry of Finance, shall be exempt from all punishment as provided in the various tax laws with regard to tax evasion and under-reporting. But any tax paid retroactively shall be paid with interest compounded daily at the postal savings rate of a one-year time deposit for the entire period from the original deadline for tax return to the date that payment is made retroactively.

H.

Normally, a taxpayer who violates the obligations of the tax laws is subject to penalty according to the current provisions of relevant tax law. However, if the penalty according to the current provisions of relevant tax laws is greater than a previous penalty applicable at the time of tax evasion, then the taxpayer is subject to the lesser penalty.

  • Visitor:2106 people  Update:2015-11-18
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