The Company supports tax policies that help companies innovate and promote economic growth. We are also committed to ensuring information transparency and sustainable development.
To effectively manage taxation risks, the Company complies with internal control procedures to identify, assess, and manage taxation risks derived from changes in regulations and business activities for identifying, assessing, and managing risks in an appropriate manner. The CFO bears the ultimate responsibilities for taxation management. The Board of Directors appointed the Audit Committee to supervise the quality and integrity of the Company's accounting, audit, financial reporting procedures, and financial management. It regularly reviews major items such as the accounting policies and procedures, internal control system, compliance (including taxation compliance), and corporate risk management. The routine taxation, administration, and management are implemented by the Finance Organization. The Company also appoints qualified and experienced external taxation professionals to assist in fulfilling the Company's tax obligations.
Taxes paid in each country
The source of the Company's revenue is Taiwan and the Company pays 100% of its income tax expenses in Taiwan. The Company paid taxes totaling NT$173 million in 2023.
Tax governance performance
The Company's effective tax rate in 2019, 2020, 2022, and 2023 was lower than the statutory tax rate of 20% for profit-seeking enterprise income tax in the Republic of China. The main reason was the Company's eligibility for R&D investment tax credits based on the Statute for Upgrading Industries and Statute for Industrial Innovation. The lower cash tax rate in 2020 was mainly due to payment of income taxes for the previous year in 2020. While in 2020, there was a significant growth in operations compared to the previous year. The cash tax rate for 2021 was higher because the taxable income was paid in the following year (i.e., 2022). The higher cash tax rate in 2023 was mainly due to payment of income taxes for the previous year in 2023. While in 2023, there was a significant fall in operations compared to the previous year. The cash tax rate for 2023 was higher because the 2022 taxable income was paid in the following year (i.e., 2023).