For tax-exempt exported tobacco or alcohol products, the taxpayer shall, within three (3) months from the day following their release from the factory, submit the application and a copy of the export declaration issued by the Customs to the competent tax authority where the manufacturer is located for case closure. If the aforesaid filing is late, tobacco or alcohol tax shall be levied.

For taxed exported tobacco or alcohol products, the taxpayer shall, after the goods are exported, submit a tax payment certificate and a copy of the export declaration issued by the Customs to the competent tax authority where the manufacturer is located for the refund of the tax and surcharge paid.

If tax-exempt exported tobacco or alcohol products cannot be exported, the taxpayer shall report to the competent tax authority where the manufacturer is located and pay the tax and surcharge, unless the goods are returned to the factory.

When exported tobacco or alcohol products are re-imported as returned goods, the manufacturer should pay tobacco or alcohol tax and the health and welfare surcharge for the imported goods.
If the aforesaid tobacco or alcohol products have been taxed and have not been filed for tax refund, the Customs may release the goods after checking the export declaration originally issued by the Customs, which is noted “Tax Not Refunded” by the competent tax authority.

If a manufacturer uses another kind of tobacco or alcohol product as raw materials for the production of its tobacco or alcohol products, it shall fill out a Material Computation Form for the materials required and apply to the competent tax authority for approval. If the competent tax authority deem there is a need to prescribe an uniform standards for the use of said materials, after sending samples of the tobacco and alcohol products to a testing agency for checking, the competent tax authority should submit a request to the Ministry of Finance for the formulation of such standards.
A taxable material shall be exempted only if it constitutes an ingredient of the tobacco or alcohol product; materials used for fueling and testing purposes shall not be exempt from tobacco and alcohol tax.

When purchasing another kind of tobacco or alcohol product to be used as material for the manufacture of tobacco or alcohol products, the manufacturer shall apply to the competent tax authority for approval of tax exemption on tobacco and alcohol tax by submitting an Application for Tax Exemption of Materials in triplicate. The first copy of the application will be kept by the competent tax authority, and the other two copies of the application will be arranged according to the following provisions after they have been signed:
(1)If the taxable materials are purchased or acquired directly from a local supplier, the manufacturer will give both copies of the application to the supplier. After filling out the factory delivery sheet as required, the supplier will retain the second copy and submit the third copy, on which then will be recorded the actual ex-factory quantity and date, to the local competent tax authority in the following month when filing the monthly return.
(2)If the taxable materials are imported, the manufacturer will give both copies of the application to the Customs for exempting from tobacco and alcohol tax. After releasing the goods, the Customs will keep the second copy and send the third copy, after it is noted with the actual quantity and date of release, to the competent tax authority where the manufacturer is located.
(3)If the taxable materials are supplied by the manufacturer itself, the manufacturer may keep the second copy of the application and send the third copy, after it is noted with the actual quantity and date of release, to the competent tax authority where the manufacturer is located for future reference.
After purchasing or acquiring tax-exempt materials, the manufacturer should immediately post the entry on its tax-exempt material register.

A manufacturer may not supply tax-exempt materials to other factories without the prior approval of the competent tax authority.

If a manufacturer does not follow the tax exemption procedures according to Article 31 herein and instead uses taxed tobacco or alcohol products to manufacture other tobacco and alcohol products, no tax or surcharge will be refunded.

In cases where a manufacturer provides tobacco or alcohol products for exhibition and afterwards returns the products to the factory or exports them, the manufacturer shall submit the information on the nature of the exhibition, organizer, exhibition site, exhibition period, and quantity needed, as well as the supporting document issued by the exhibition organizer to the competent tax authority for approval of tax exemption on the products when released from the factory or imported.
If the aforesaid tax-exempt goods are to be sold at the exhibition site, the manufacturer shall pay tobacco or alcohol tax and health and welfare surcharge to the competent tax authority where the manufacturer is located.
For the tax-exempt tobacco or alcohol products for exhibition, the taxpayer shall, within one month from the conclusion of exhibition, submit the related return shipment documents or a copy of the export declaration issued by the Customs to the competent tax authority where the manufacturer is located for case closure. If the aforesaid filing is late, tobacco or alcohol tax shall be levied.

In cases where ex-factory taxed tobacco or alcohol products are returned to the factory for re-sorting, re-packaging or re-processing, the manufacturer may submit the return delivery documents to the competent tax authority for approval. After obtaining approval from the tax authority, the manufacturer shall submit the original tobacco or alcohol tax and health and welfare surcharge payment receipt to the tax authority for refund. After the aforesaid returned goods are repacked or reprocessed, the manufacturer will file tax return and pay tobacco or alcohol tax and health and welfare surcharge for those goods along with tobacco or alcohol products released from the factory in the same month.
Returned taxed tobacco or alcohol products for which the return procedures as specified in the preceding paragraph are not followed shall be treated as new ex-factory goods and subject to tobacco or alcohol tax and health and welfare surcharge.

In cases where taxed tobacco or alcohol products, which are returned to the factory for reprocessing due to poor quality or damage, incur losses in the reprocessing, the manufacturer must obtain the approval of the competent tax authority before writing off the damaged goods.

If taxed tobacco or alcohol products become disqualified according to governmental standards due to deterioration in quality or damage, the manufacturer should provide the information on location of storage, and method and date of disposition, and request the competent tax authority where the goods are located to dispatch an officer to oversee the disposal or melting down of those goods. After the goods are thus disposed of, the manufacturer may apply to the local tax authority or customs house for refund of tobacco or alcohol tax and the health and welfare surcharge paid.

Taxed tobacco or alcohol products that have been opened after sale but returned in exchange for a replacement shall still be subject to tobacco or alcohol tax and the health and welfare surcharge.

If tobacco or alcohol products are physically destroyed in a fire, lost at sea, or destroyed in other force majeure events after they have been released from the factory or by the Customs, the manufacturer or importer may apply to the competent tax authority or customs office for refund of tax and surcharge paid by presenting a damage list and support documents within thirty (30) days after the occurrence of the event.
Chapter 6 Supplemental Provisions