Tax levies are divided into national, special municipality, and county (or county-level city) taxes.

Legislation by special municipalities, counties or county-level cities, and rural or urban townships or township-level cities for the purpose of levying taxes is restricted to legislation for which this Act expressly provides, and shall conform with the Act Governing Local Tax Regulations.

The following taxes are national taxes:
1. Income tax.
2. Estate and gift tax.
3. Customs duties.
4. Business tax.
5. Commodity tax.
6. Tobacco and alcohol tax.
7. Securities transaction tax.
8. Futures transaction tax.
9. Mining concession tax.
Ten percent of total revenue from the income tax of subparagraph 1 of the preceding paragraph, 40 percent of total revenue from the business tax of subparagraph 4 after deduction of duly appropriated Uniform Invoice Prizes, and 10 percent of total revenue from the commodity tax of subparagraph 5 shall be redistributed from the central government to the special municipalities, counties and county-level cities, and rural and urban townships and township-level cities.
Fifty percent of revenue from the estate and gift tax of paragraph 1, subparagraph 2 that is collected in a special municipality shall be returned to the respective municipality; 80 percent of revenue from such tax that is collected in a county-level city shall be returned to the respective county-level city; and 80 of revenue from such tax that is collected in a rural or urban township or township-level city shall be returned to that township or township-level city.
Eighteen percent of total revenue from the tobacco and alcohol tax of paragraph 1, subparagraph 6 shall be distributed among the special municipalities and the counties and county-level cities of Taiwan Province, in proportion to their populations; 2 percent of the total revenue shall be distributed to Jinmen County and Lianjiang County of Fujian Province, in proportion to their populations.

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The following taxes are special municipality and county and county-level city taxes:
1. Land tax, which includes the following:
(1) Land value tax
(2) Agricultural land tax
(3) Land value increment tax.
2. Building tax.
3. Vehicle license tax.
4. Deed tax.
5. Stamp tax.
6. Amusement tax.
7. Special tax levies.
A county shall return 30 percent of the total revenue from the land value tax of subparagraph 1, item 1 that is collected in a given rural or urban township or township-level city to the respective rural or urban township or township-level city, and shall redistribute a further 20 percent of the total revenue so collected among the rural and urban townships and township-level cities of the county; a county shall return all of the total revenues from the agricultural land tax of subparagraph 1, item 2 that are collected in a given rural or urban township or township-level city to the respective rural or urban township or township-level city; 20 percent of the revenues from the land value increment tax of subparagraph 1, item 3 that are collected in counties and county-level cities shall be transferred to the central government for redistribution among counties and county-level cities.
A county shall return 40 percent of the revenue from the building tax of paragraph 1, subparagraph 2 that is collected in a given rural or urban township or township-level city of the county to the respective rural or urban township or township-level city, and shall redistribute a further 20 percent of the total revenues so collected to the county's rural and urban townships and township-level cities.
A county shall return 80 percent of the revenue from the deed tax of paragraph 1, subparagraph 4 that is collected in a given rural or urban township or township-level city of the county to the respective rural or urban township or township-level city, and shall redistribute 20 percent of the total revenue so collected to the county's rural and urban townships and township-level cities.
A county shall return all of the revenue from the amusement tax of paragraph 1, subparagraph 6 that is collected in a given rural or urban township or township-level city to the respective rural or urban township or township-level city.
The term "special tax levies" of paragraph 1, subparagraph 7 refers to taxes levied through legislation by local legislative bodies in response to the requirements of local self-government. Such legislation, however, may not levy further taxes on items to which commodity tax or alcohol and tobacco tax already apply.

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The redistribution of tax revenues pursuant to the relevant provisions of Article 8, paragraph 2 and Article 12, paragraphs 2 to 4 shall be based on the principles of transparency and the application of formulas. The local governments that receive the redistributions shall recognize the amounts so received as current-year tax revenues.
The regulations that govern the redistribution of tax funds from the central government to the special municipalities, counties and county-level cities, and rural and urban townships and township level cities shall conform with each of the following subparagraphs. The regulations shall be drafted by the Ministry of Finance following consultation with the central authority for budget, accounting, and statistics and the local governments receiving the distributions, and shall be submitted to the Executive Yuan for ratification:
1. Six percent of the total amount of tax funds redistributed by the central government to special municipalities, counties and county-level cities, and rural and urban townships and township-level cities pursuant to Article 8, paragraph 2 shall be recognized as "special centrally-funded tax revenues." The remaining 94 percent shall be recognized as "general centrally-funded tax revenues." Both categories of tax funds shall be distributed at specific ratios to special municipalities, counties and county-level cities, and rural and urban townships and township-level cities.
2. The full amount of tax funds redistributed from the central government to counties and county-level cities in accordance with the latter part of Article 12, paragraph 2 shall be recognized as "general centrally-funded tax revenues."
3. The "special centrally-funded tax revenues" of subparagraph 1 shall be provided to the local governments that receive the distributions as necessary funding support for use in emergencies and other major matters. The funds will be distributed by the Executive Yuan based on actual circumstances.
4. After a determination that the "general centrally-funded tax revenues" of subparagraph 1 are funds that can be provided for distribution to special municipalities, factors shall be considered relating to the special municipalities in the preceding fiscal years, such as the sales revenues of business units, the municipalities' fiscal capabilities, and their populations and land areas, in order to develop a formula for the distribution of the funds.
5. After a determination that the "general centrally-funded tax revenues" of subparagraphs 1 and 2 are funds that can be provided for distribution to counties and county-level cities, they shall be distributed based on the following formula:
(1) Eighty-five percent of the funds that can be provided for distribution to counties and county-level cities shall be allocated according to ratios determined by calculating the average difference, during the preceding three fiscal years, between the basic fiscal needs and basic fiscal revenues of each of the counties and county-level cities receiving the allocations. The ratios for allocation thus calculated shall be re-examined and adjusted every three years.
(2) Fifteen percent of the funds that can be provided for distribution to counties and county-level cities shall be allocated according to ratios determined by calculating the sales revenues of business units within the jurisdictions of each of the given counties and county-level cities.
6. After a determination that the general centrally-funded tax revenues under subparagraph 1 can be distributed to rural and urban townships and township-level cities, a formula shall be developed for distribution of the funds to the each of the rural and urban townships and township-level cities in consideration of personnel expenses for formal civil servants and their basic infrastructure needs.
The standards for and method of calculating the "fiscal capability" of subparagraph 4 of the preceding paragraph and the "basic fiscal needs and basic fiscal revenues" of subparagraph 5, item 1 shall be expressly provided in the regulations governing the redistribution of tax funds from the central government provided in the preceding paragraph. Jinmen County and Lianjiang County of Fujian Province shall be considered separately.
A county government shall adopt regulations, based on the principal of adjustments for fiscal surpluses or shortages, to govern the redistribution of funds from the county to rural and urban townships and township-level cities under Article 12, paragraphs 2 to 4. Funds that are redistributed according to formula may not be less than 90 percent of the total funds available for redistribution.

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No government at any level may impose a double tax or a surtax on the tax levies of another government at the same level or any other level. This restriction does not apply, however, to the governments of special municipalities, counties, and county-level cities when, to raise the necessary financing to manage self-governmental affairs, they impose a surtax in accordance with the Act Governing Local Tax Regulations.
No local government at any level may impose an entry tax or a transit tax on goods that enter or pass through its jurisdiction.

A government at any level, in order to meet special needs, may impose a provisional tax levy through legislation by the people's representative body at that level.

A government at any level, having obtained permission by law, may operate a monopoly public utility, and may duly impose a franchise fee and permit the operation of the utility by a private party.
The area supplied by a monopoly public enterprise operated by a local government shall be limited to the area under that government's jurisdiction, provided that a stipulation to expand the area supplied may be made by agreement with the local government of a neighboring area.

The central government, in order to increase national treasury revenues or to control the costs of production, may sell monopoly goods in accordance with the provisions of law, and may manufacture such goods.

When there is construction of roads, levees, ditches, harbors and piers, or other land and water improvement projects within the jurisdiction of a government at any level, that government may collect fees on construction profits from any real property that directly profits from the construction or from any ship that profits from the construction.
Collection of fees on construction profits under the preceding paragraph shall be limited to the actual amount of expense directly and indirectly incurred in the given construction project. If the expense for the construction is financed by borrowing, the collection of the fees shall be limited to the amount required for full payment of the borrowed funds and the interest on those funds. However, if continued maintenance is required for the given construction project, fees may continue to be collected in accordance with the required maintenance.
Construction projects and the collection of fees on construction profits may be undertaken only after the requisite budgetary procedures have been carried out.

Except as otherwise provided by law, any lawfully collected criminal or administrative fine, confiscated property, or revenue from compensation shall be placed in the respective public treasury of the given level of government.

The charges and fees of judicial bodies, examination bodies, and the administrative agencies at various levels of government shall be collected as provided by law. If not provided by law, charges and fees may not be collected except by the prior passage of a resolution by the relevant legislative or representative body approving the specific charge or fee.

Except as otherwise provided by law, charges and fees collected by any public enterprise organization shall be approved first by the highest-level authority for the given enterprise and placed in the public treasury of the given level of government after the requisite budgetary procedures have been carried out.

A government at any level and the agencies subordinate to it, when lawfully engaging in trust management or managing a trust on behalf of another party, may collect trust management fees.

Except as otherwise provided by law, interest generated by assets owned by a government at any level, or the sale price of assets sold by it, or capital recovered by it, shall be placed in the public treasury of the given level of government.

The sale of real property or important assets by any level of government shall be done in accordance with the law. Except as otherwise provided by law, items generated by assets owned by a public agency, or surplus or waste items among the items used by that agency, may be sold at the current market price after a request to do so has been approved by a superior competent authority.

Except as otherwise provided by law, operating surpluses, donations and contributions received, and other lawful revenues received at any level of government shall be placed in the respective public treasury of that level of government.

The central government, in seeking balanced development of the national economy, may consider providing subsidies to local governments, provided that such subsidies are limited to the following:
1. Programs whose benefits will be broad in scope, while also having goals that are comprehensive in nature.
2. Infrastructure projects whose scope extends beyond a special municipality, county or county-level city, or spans two or more counties or county-level cities.
3. Major infrastructure projects that will serve in a demonstration capacity.
4. Matters in which the cooperation of the local government is needed for major central government policies or infrastructure projects.
Regulations governing subsidies provided under each of the subparagraphs of the preceding paragraph shall be adopted by the Executive Yuan.

A county government, in seeking balanced development of rural and urban townships and township-level cities, may consider providing subsidies to those rural and urban townships and township-level cities. The regulations governing such subsidies shall be separately adopted by the county government.

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Any higher-level government, to respond to special needs, may obtain assistance funding from lower-level governments with relatively strong fiscal capabilities.
The "assistance funding" of the preceding paragraph shall be recognized in the budgets of each of the given lower-level governments.

No government at any level may issue government bonds, or engage in borrowing from a domestic or foreign source with a repayment period of one year or more, except as provided by law or by passage of a resolution in the relevant legislative body.
The limits on outstanding debt in the form of government bonds or borrowing under the preceding paragraph shall be determined in accordance with the Public Debt Act.
A local government at any level shall first receive approval from the central government before issuing government bonds or borrowing funds abroad.