Taiwan debates over menstrual products tax exemption

TAIPEI (TVBS News) — While lawmakers across party lines support the exemption of sales tax on menstrual products, the Ministry of Finance expressed concerns Wednesday (April 10) that the benefits of the tax reduction, which would cost the national treasury NT$380 million, may not fully reflect on the product prices, failing to benefit women substantially.

Statistics show that women spend nearly NT$100,000 on menstrual products in their lifetime. However, the current wage structure is unequal, with women's wages being 81.68% of men's, exposing them to health risks associated with period poverty.

Minister of Finance Chuang Tsui-yun stated that Taiwan's value-added tax (VAT) rate of 5% is already the lowest internationally. The exemptions in Article 8 of the Value-added and Non-value-added Business Tax Act have specific policy objectives and do not provide tax exemptions for individual products.

Chuang pointed out that most countries with a VAT system do not exemptmenstrual products from sales tax. Additionally, if businesses do not fully reflect the tax reduction benefits in the product prices, consumers cannot substantially enjoy the tax reduction benefits. Instead, the national treasury subsidizes the manufacturers and sellers of menstrual products with a tax revenue loss of NT$380 million annually.

Chuang also expressed concerns that other businesses selling similar products, such as diapers for infants and adults or toilet paper, may demand the same tax reduction, undermining the characteristics of the sales tax as a general consumption tax and potentially expanding tax revenue loss.