|Is Subsidy subject to business tax?|
The Taxation Bureau stated that if a business entity accepts the subsidy, whether it should open a unified invoice and levy a business tax, should be considered whether the subsidy is due to the sale of goods or the provision of labor services.
According to the value-added and non-value-added business tax act, sales of goods or services within the territory of the Taiwan should be subject to business tax.
Whether the business operator subsidy should be subject to business tax, should evaluate if the subsidy is related to the sales behavior.
For example, Company A received the subsidy from the Foundation for research and development, and agreed that R&D results belonged to Company A. Since the company A’s subsidy for the Foundation was not obtained due to sales activities, it should not be subject to business tax; On the other hand, if the R&D results belong to the foundation or are co-owned by Company A and foundation, then the company A collects the subsidy, which is the consideration obtained by providing the labor service to the foundation, Company A shall open a unified invoice and submit the business tax according to the regulations
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