Using 1997 tax return data of profit-seeking enterprises, this study explores the relations between the benefits of tax incentives and firm characteristics across industries, and examines the effect of tax incentives on effective tax rates of profit-seeking enterprises. The empirical results show that current tax incentives have a significant impact on effective tax rates of profit-seeking enterprises. However, the distribution of tax benefits is inequitable across firms, industries, and regions. Large firms obtain most of the tax benefits, and both the electronic and manufacturing industries capture greater tax benefits than other industries. Further, firms located in the northern Taiwan enjoy greater tax benefits than those in the middle and southern Taiwan. Therefore, the empirical results suggest that, to help achieve the nation's goal, the government should formulate better tax incentive schemes to stimulate regional economies across Taiwan and advance both new high-tech and traditional industries.