Taipei: Taiwan ranked fifth among 184 economies in the 2026 Index of Economic Freedom, slipping one place from a year earlier despite a slight increase in its overall score, according to the annual report released Tuesday by the Washington-based Heritage Foundation. Taiwan received a score of 79.8, up 0.1 points from 2025. It ranked behind Singapore, Switzerland, Ireland, and Australia, while placing third in the Asia-Pacific region.
According to Focus Taiwan, the ranking put Taiwan ahead of several major economies, including the Netherlands (10th), Canada (14th), South Korea (19th), the United States (22nd), the United Kingdom (29th), Japan (30th), and China (154th). Taiwan was rated "free" (scores of 80-100) in six of the index's 12 indicators: judicial effectiveness, fiscal health, government spending, trade freedom, property rights, and monetary freedom.
In a statement issued Wednesday, Taiwan's National Development Council (NDC) attributed the country's performance partly to legal and regulatory reforms implemented between 2024 and 2025, including amendments aimed at improving the business environment, promoting the use of electronic signatures, and attracting highly skilled foreign professionals. Taiwan's weakest-performing category was tax burden, where it fell from 87th to 93rd place.
The NDC said while Taiwan's tax burden is higher than in Hong Kong and Singapore, it remains lower than that of China, Japan, and South Korea. Looking ahead, the NDC said global economic conditions will be shaped by factors including the rapid development of AI, U.S. tariff policies, China's industrial overcapacity, geopolitical risks, and climate challenges.