Revising Time Limitations on Taxable Amounts of Sales Return and Its Obligation in the Business Tax Act

Business tax is a kind of obligation which belongs to consumptions and will occur when it conforms to the rules. However, double taxation is the most essential problem while collecting business tax.In order to solve the problem of double taxation, Taiwan law adopted the system of Value Added Tax (VAT) from Europe. By using this new system, the amount of business tax payable by a business entity will be the difference between the output tax in a tax period and the input tax in the same period, which gradually shifted the tax burden to the final consumers.

To be more specific, when the business entity applies for cancellation of a contract to file sales returns, the tax law prescribes specific rules which allow the business entity to make restitution through revising the amount of tax. However, in Taiwan, the Board of National Tax Administration does not realize that purchase returns should be adjusted accordingly with sales returns, which cause problems when filing the tax and increase additional burden to both seller and buyer.The purpose of this thesis is to show the outline of this problem by clarifying the legal concept of sales returns and organizing the related judgments made by the Administrative Court. It can be expected that after classifying these questions, both judgment in the court and the scholarly community can fully realize the problem and amend a more reasonable tax law to facilitate the economic development.