TAIPEI (TVBS News) — Taiwan's imported car prices remain the highest in Asia, primarily due to tariffs and commodity taxes, prompting consumer calls for tariff abolition. However, the Taiwan Transportation Vehicle Manufacturers Association (TTVMA, 台灣車輛工業同業公會) advocates for lowering commodity taxes instead. The association's president, Chen Chao-wen (陳昭文), reported a 3.9% decline in domestic car production in 2024, with exports dropping by 3.4%.
In 2024, Taiwan's domestic car sales reached 233,000 units, maintaining a market share 1.8 percentage points higher than imported vehicles, largely due to pricing. Tseng Yen-hao (曾彥豪), an automotive website director, suggests that abolishing the 17.5% tariff on small passenger vehicles could cut prices by 10%. However, the association warns of potential impacts on NT$840 billion in gross output, over 2,500 companies, and 300,000 jobs.
The Ministry of Economic Affairs (MOEA, 經濟部) cautions that eliminating import tariffs could lead to a tax revenue shortfall exceeding NT$52.3 billion and reduce the domestic car market share to 20%. Tseng argues that adjusting commodity taxes could more significantly affect car prices. With Taiwan's electric vehicle prices at around NT$2.44 million, higher than in Singapore, Korea, and Australia, lowering these taxes might provide tangible relief.
Chen emphasized that tariff cuts benefit only imported cars, while reducing commodity taxes could stimulate broader car purchases. He also noted the importance of considering factors like material costs and labor shortages. Chen highlighted the success of trade-in policies in boosting consumer interest and urged the government to implement sustainable automotive industry policies. Given the automotive industry's strong ties to other sectors, any tax reduction requires thorough consideration.
