Last updated: 6 October 2026
The carbon fee is charged on a business's greenhouse gas emissions following inventory registration and verification. The current general rate is NT$300 per metric tonne CO₂e, with preferential rate A at NT$50 and B at NT$100. To determine the actual fee, first confirm chargeable emissions and eligibility; do not simply multiply total company emissions by the lowest rate.
What Is a Carbon Fee, and How Does It Differ from Carbon Taxes and Credits?
Taiwan's carbon fee is a statutory charge on designated businesses under the Climate Change Response Act and related regulations. A carbon tax is a tax instrument, while carbon credits involve tradable instruments such as emission reduction credits. These terms are not interchangeable.
| Term | Concept | What businesses need to distinguish |
|---|---|---|
| Carbon fee | A statutory charge on emissions | Confirm coverage, chargeable emissions, rates and filing deadlines |
| Carbon tax | Pricing carbon emissions through taxation | Assess under the tax laws of each system; do not directly apply Taiwan's carbon fee regulations |
| Carbon credits / emission reduction credits | Instruments such as reduction credits issued or recognised under a programme | Buying credits does not automatically exempt a business from carbon fees; deductions must meet the rules |
The Climate Change Response Act was amended, promulgated and took effect on 15 February 2023. On 29 August 2024, the Ministry of Environment issued the Regulations Governing the Collection of Carbon Fees, the Regulations Governing Voluntary Reduction Plans, and the Designated Greenhouse Gas Reduction Targets for Carbon Fee Collection Targets. For the system and use of revenue, see the Climate Change Administration's carbon fee portal; revenue is earmarked through the Greenhouse Gas Management Fund for emission reduction, adaptation and related work.
Which Businesses Must Pay Carbon Fees?
Current coverage includes electricity and gas suppliers and manufacturers with emission sources designated for inventory registration and verification, whose combined facility-wide direct and electricity-related indirect emissions reach 25,000 metric tonnes CO₂e per year. These conditions must be considered together; conducting an inventory does not automatically mean a business must pay carbon fees.
The criteria are set out in Article 3 of the Regulations Governing the Collection of Carbon Fees. First confirm regulatory status and facility boundaries, then annual emissions, and finally whether the conditions for first-time coverage apply. Article 3-1, added by the amendment of 1 September 2026, separately establishes when filing and payment obligations begin for newly qualifying entities. The starting year for existing fee-paying entities should not simply be reused.
Article 3-1 also requires conditions such as no previous emissions reporting or carbon fee filing and payment for the same business or emission source. Not every new facility can independently assume a deferral. Businesses clarifying their obligations can first organise their carbon inventory boundaries and data, then compare them against the official provisions.
What Are the Rates, and How Is the Carbon Fee Calculated?
The carbon fee equals chargeable emissions multiplied by the applicable rate. Chargeable emissions are calculated using the K value and an emissions adjustment coefficient. General businesses and recognised high carbon leakage risk businesses have different K values; identify the applicable category before calculating.
| Rate | NT$ per metric tonne CO₂e | Key conditions |
|---|---|---|
| General rate | 300 | When no preferential rate applies |
| Preferential rate A | 50 | An approved voluntary reduction plan meeting requirements such as industry-specific designated reduction rates |
| Preferential rate B | 100 | An approved voluntary reduction plan meeting requirements such as technology-benchmark designated reduction rates |
Rates follow the Ministry of Environment's explanation of its Carbon Fee Rates announcement. Under Articles 5 and 6 of the collection regulations, chargeable emissions = (annual emissions − K value) × emissions adjustment coefficient. For businesses not recognised as having high carbon leakage risk, K is 25,000 metric tonnes and the coefficient is 1. For recognised high carbon leakage risk businesses, K is 0, and the coefficients for the first, second and third phases are 0.2, 0.4 and 0.6 respectively.
The following examples assume annual emissions of 100,000 metric tonnes CO₂e in every case. They are illustrative calculations, not actual corporate bills. They exclude reduction-credit deductions and other adjustments available by application under the law. Each row assumes the relevant preferential-rate eligibility and high carbon leakage risk recognition have been satisfied.
| Assumed scenario | Chargeable emissions formula | Illustrative carbon fee |
|---|---|---|
| General business, general rate | (100,000 − 25,000) × 1 = 75,000 metric tonnes | 75,000 × 300 = NT$22,500,000 |
| General business, preferential rate B | (100,000 − 25,000) × 1 = 75,000 metric tonnes | 75,000 × 100 = NT$7,500,000 |
| High carbon leakage risk, first phase, preferential rate A | (100,000 − 0) × 0.2 = 20,000 metric tonnes | 20,000 × 50 = NT$1,000,000 |
The high carbon leakage risk adjustment requires an approved voluntary reduction plan and recognition following review; businesses cannot select it themselves. Article 6 also requires an application for recognition by 31 January of the payment year. The coefficient phases should not be independently converted into calendar years that have not been announced.
How Do You Apply for Preferential Rates?
Businesses must submit a voluntary reduction plan, obtain approval, implement it and meet review requirements to qualify for preferential rates. Choosing A or B concerns the reduction pathway and designated targets; it is not a free choice of the lowest price when filing.
Under Article 11 of the Regulations Governing Voluntary Reduction Plans, applications submitted by 30 June and those submitted after that date have different first years of preferential-rate applicability. The former may qualify in the application year, subject to approval and review conditions; the latter qualify from the following year. These are the emissions and rate-applicability years; actual payment still follows the next year's schedule.
Entities newly covered and meeting the definition in Article 3-1 of the collection regulations are separately subject to Article 11-1 of the Regulations Governing Voluntary Reduction Plans. If they submit a plan by 31 October of the year in which they complete the required inventory, registration and verification, and obtain approval, they may proceed under Article 11, paragraph 1, subparagraph 1. Confirm eligibility for this exception before determining the application deadline.
Article 9 also requires submission of the previous year's implementation progress report by 30 April each year. For plan preparation and drafting, see the practical guide to voluntary reduction plans. Check application deadlines, designated targets and approval conditions against the current official regulations linked on this page.
How Much of the Carbon Fee Can Carbon Credits Offset?
Eligible domestic reduction credits may be used to apply for a deduction from chargeable emissions, capped at 10% of chargeable emissions. This is an emissions deduction cap; it does not mean any purchase cost can directly reduce the amount payable, or that every credit type converts at a one-to-one ratio.
Under Article 9 of the collection regulations, the deduction ratio for voluntary reduction or offset project credits is 1.2. For legacy early-action project credits, it is 0.3 for businesses without high carbon leakage risk and 0.1 for those with high carbon leakage risk. Legacy early-action credits can be used only during the first three years after carbon fee collection begins. Confirm the credit type before applying the deduction ratio and cap.
For example, if chargeable emissions are 75,000 metric tonnes, the domestic-credit deduction cap is 7,500 metric tonnes. If only eligible credits with a ratio of 1.2 are used, 6,250 metric tonnes of credits are needed to reach that cap. This is an illustrative formula; actual use still requires confirmation of credit eligibility and cancellation documents. Under Article 11, deduction applications must include proof of cancellation and be submitted with the carbon fee filing by the end of May each year.
Foreign reduction credits are governed separately by Article 10 and are available only to businesses not recognised as having high carbon leakage risk. They must meet the competent authority's recognition conditions, with a deduction cap of 5%; this does not mean any overseas credit can be used. To clarify credit sources, see Taiwan carbon credits and carbon fee offset rules.
When Are Payments Due, and What Were the First-Year Results?
Existing fee-paying entities generally file and pay the previous year's carbon fee by the end of May each year. Trial filing took place in 2025, followed in 2026 by the first payment for 2025 emissions. The first deadline was extended to 1 June 2026 because of a holiday.
| Administrative year | Corresponding task | Key timing |
|---|---|---|
| 2025 | Trial filing without payment; that year's emissions begin accruing fees | Rates effective from 1 January 2025 |
| 2026 | First payment of carbon fees for 2025 | Normally the end of May, extended to 1 June that year |
| 2027 | Payment of carbon fees for 2026 | By the end of May under current rules |
The schedule follows Article 4 of the collection regulations, the official carbon fee portal and the Ministry of Environment's press release of 3 June 2026. Preliminary figures in that release show that all 240 companies, covering 461 facilities, paid a total of NT$4.97 billion. Voluntary reduction plans were approved for 402 facilities, including 64 under rate A and 338 under rate B. These are first-period statistics, not fixed annual numbers of paying entities or revenue for future years.
Will Rates Rise in the Next Period?
Rates for the next period remain subject to deliberation and formal announcement. Figures under discussion should not be treated as confirmed business costs. This article does not list unannounced prices or definite effective years. When budgeting, label current rates and hypothetical scenarios separately.
The minutes of the rate review committee meeting on 12 February 2026 recommend phased increases and public communication before increases take effect, but this recommendation is not itself a new rate announcement. Check the official deliberation updates and rate announcements to reconfirm prices, applicable emissions years and payment years.
Next Step: Prepare Inventory and Emissions Reduction Data
Confirm regulatory status, annual emissions, factor versions and the status of your voluntary reduction plan before estimating carbon fees. Put inventory data, approval documents and reduction results into a cross-checkable working list, distinguishing approved conditions from scenarios still being assessed.
For export-related issues, see CBAM's definitive period and corporate data preparation; for tool evaluation, see the carbon inventory system comparison. Sustaihub's DCarbon provides automated organisational carbon inventories, an AI document assistant and AI inventory reports to support data organisation and calculation. Formal verification is performed by third-party bodies.
Carbon Management Fundamentals Series
Start with carbon inventories and explore regulations, costs and emissions reduction targets as needed:
- What Is a Carbon Inventory? 5 Steps, Regulatory Requirements and Tool Selection
- Greenhouse Gas Inventories: Which Businesses Must Register? Schedules, Guidance and Categories 1–6
- What Is Taiwan's Carbon Fee? Rates, Coverage, Calculations and Payment Schedule (this article)
- What Is a Carbon Footprint? Product Calculations, ISO 14067 and Emission Factor Lookup
- What Are Scopes 1, 2 and 3? The 15 Scope 3 Categories and ISO 14064-1 Mapping
- What Are Carbon Credits? Trading, Prices and Carbon Fee Offset Rules in Taiwan
- What Are Net-Zero Emissions? Taiwan's 2050 Pathway and First Steps for Businesses
- What Is Carbon Neutrality? ISO 14068-1, the 2026 Edition and Ministry of Environment Claims Guidance
