TAIPEI (TVBS News) — Taiwan's automotive industry braces for significant policy shifts as trade negotiations with Washington enter a critical phase. The looming expiration of the 90-day grace period for U.S. reciprocal tariffs has intensified discussions about potential adjustments to Taiwan's longstanding automotive import duties. Taiwan's Ministry of Economic Affairs (MOEA, 經濟部), the government agency overseeing industrial and commercial policy, revealed Wednesday that lawmakers across party lines have reached a rare consensus on reducing the island's vehicle commodity taxes. Ministry officials indicated they would wait to finalize these tax reduction measures until after completing the sensitive tariff negotiations with American trade representatives, aiming to minimize disruptions for domestic manufacturers.
Senior government official Chiu Chiu-hui (邱求慧), who heads the Department of Industrial Development (DoIT, 產業發展署), a key division within Taiwan's economic ministry, firmly rejected media characterizations of the government's approach as following a predetermined "two-stage strategy." During a press briefing, Chiu emphasized that Taiwanese authorities remain actively engaged in the delicate tariff negotiation process with American trade representatives. He drew a clear distinction between the international discussions focusing exclusively on tariff structures and the separate domestic policy considerations regarding commodity taxes, which he indicated would only be addressed internally after the completion of the U.S.-Taiwan trade talks.
Addressing concerns about possible manufacturing relocations if import duties are lowered, Chiu revealed aspirations to structure the Taiwan-U.S. automotive trade framework similarly to the recently established U.K.-U.S. agreement. The economic official sought to reassure domestic producers by emphasizing that any new tariff regime would exclusively affect vehicles imported from the United States, not global imports. Chiu further downplayed potential market disruptions by highlighting the currently minimal market share held by American automobile manufacturers in Taiwan's domestic market. He specifically mentioned that even with potential tariff reductions, premium electric vehicles from Tesla would likely maintain price points above locally manufactured electric alternatives.
The government official further outlined Taiwan's ongoing industrial priorities, acknowledging the island's substantial manufacturing capacity remains concentrated in traditional combustion engine vehicles. Chiu revealed that Economic Affairs Minister J.W. Kuo (郭智輝) is actively evaluating potential resource allocations and investment packages designed to facilitate the transformation of Taiwan's conventional automotive sector toward electric vehicle production capabilities. This strategic pivot, according to Chiu, represents a deliberate effort to align Taiwan's automotive manufacturing ecosystem with accelerating global electrification trends and position the island's producers for future competitiveness in international markets. ◼
