No.

Taiwan

Mainland

1

Profit-seeking Enterprise Income Tax:

?/SPAN> Basic tax rate is 20%

?/SPAN> The tax rate is 12% after the implementation of Income Basic Tax Act (thereafter [Alternative Minimum Tax]).

?/SPAN> For a profit-seeking enterprise with independent legal personality, while the current year’s surplus is not distributed in the following year, an additional 5% profit-seeking enterprise income tax is required

?/SPAN> Loss carrying forward period is 10 years

Enterprise Income Tax

?/SPAN>  Basic tax rate is 25%

?/SPAN>  Preferential tax rate for high-tech enterprises: 15%

?/SPAN>  Preferential tax rate for small low-profit enterprises: 10%, 5%

?/SPAN>  No tax regulations for undistributed surplus

?/SPAN>  Loss carrying forward period is 10 years

2

Value-added and Non-value-added Business Tax:

Scope of Taxation:

?/SPAN> In /into Taiwan

-     Sales of goods

-     Sales of services, including sales of [electricity labor]

-     Import of goods

Tax Rate:

?/SPAN> Value-added business

-     Tax rate is 5%

-     Tax rate for exportation is 0%,

?/SPAN> Non-value-added business

-     Finance and Insurance Industry/Special Catering Industry/Small-scale Business

-     Tax rate ranges from 0.1% to 25%

-     Tax rate for sales amount which are not connected exclusively with core business is 5%.

Value-added Tax

Scope of Taxation:

?/SPAN> In/into Mainland

-     Sales of goods

-     Sales of services (processing or repairing services)

-     Sales of services (seven categories of services)

-     Sales of intangible assets

-     Sales of immovable property

-     Import of goods

Tax Rate:

?/SPAN> Basic tax rate is 13%, 6% and 3%

?/SPAN> Lower tax rate for general taxpayers is 9%

?/SPAN> Zero tax rate

No.

Taiwan

Mainland

3

Commodity Tax

?/SPAN>  Taxes levied on specific commodities manufactured domestically (including process taxable products under consignment) or imported from abroad.

?/SPAN>  Tax is calculated ad valorem or based on quantity.

?/SPAN>  The tax rate and tax amount vary considerable with the type of product.

Consumption Tax

Same with Commodity Tax

4

Dividends Withholding Income Tax

?/SPAN>  The basic withholding tax rate for surplus remittance is 21%

?/SPAN>  Minimum tax rate can be reduced to 10% to 15% under the tax treaties.

?/SPAN>  No need to withhold tax for surplus remittance by branch.

Dividends Withholding Income Tax

?/SPAN>  The basic tax rate is 10%.

?/SPAN>  Minimum tax rate can be reduced to 5% under the tax treaties.

5

Customs Duties

Taxation Scope:

?/SPAN>  Import of goods

?/SPAN>  Export of goods are not subject to customs duties.

Customs Duties

Taxation Scope:

?/SPAN>  Customs duties shall be collected on goods permitted to be imported or exported except for those who are exempted from the customs duties by laws and regulations.

6

Stamp Duty

Taxation Scope:

?/SPAN>  A monetary receipt or contract subject to stamp duty while it is signed in Taiwan.

Tax Rate:

?/SPAN>  0.1% to 0.4% of the contract value

?/SPAN>  NTD 12 per document for sales of moveable property

Stamp Duty

Taxation Scope:

?/SPAN>  Taxable documents, including various economic contracts, business accounting books and right license which are signed, used or received in Mainland.

Tax Rate:

?/SPAN>  0.05?to 1?of contract value according to the contract economic categories.

?/SPAN>  RMB 5 per document for certificate of rights and licenses.

?/SPAN>  Business accounting books:

-     Capital recording documents: 0.05?of total paid-in capital and capital reserve.

-     Other accounting documents: RMB 5 per document.

No.

Taiwan

Mainland

7

Land Value Increment Tax

Taxation Scope:

?/SPAN> While the land ownership is transferred.

?/SPAN> Land transferred by succession, public land sold or donated by government, and donated private land, expropriated land, agricultural land, gifts between spouses, etc., are exempt from land value increment tax.

Tax Rate:

?/SPAN> The tax is levied at 20%, 30% and 40% of the total value increment in the land transferred by seller.

Land Appreciation Tax

Taxation Scope:

?/SPAN> Disposal of transfer with consideration of State-owned land use rights, buildings on land and their attached facilities.

Tax Rate:

?/SPAN> The tax is levied at 30% to 60% of the total value increment in the land transferred by seller.

8

Deed Tax

Taxation Scope:

?/SPAN> The transfer of ownership of real estate in Taiwan through sale, creation of dien, exchange, donation, subdivision, or occupancy.

?/SPAN> While the land in the area where land value increment tax is levied, is exempt from deed tax. In practice, the deed tax is levied at the time of transfer, the taxpayer is the party that acquires ownership and the tax rate is 6%

Tax Rate:

?/SPAN> Tax rate ranges from 2% to 6%

Deed Tax

Taxation Scope:

?/SPAN> The transfer of ownership of land and house property rights in Mainland:

-          Transfer of the state-owned land use right.

-          Transfer of the land use right.

?/SPAN>   Housing property sale, donation or exchange

Tax Rate:

?/SPAN> Tax rate ranges from 3% to 5%