UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 10-Q

[X]   QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
      EXCHANGE ACT OF 1934

      For the quarterly period ended March 31, 2008

                                       or

[ ]   TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
      EXCHANGE ACT OF 1934

      For the transition period from __________ to __________

                         Commission File Number: 0-25844
                         TAITRON COMPONENTS INCORPORATED
             (Exact name of registrant as specified in its charter)

          California                                  95-4249240
--------------------------------------------------------------------------------
  (State or other jurisdiction of        (I.R.S. Employer Identification No.)
   incorporation or organization)

       28040 West Harrison Parkway, Valencia, California 91355-4162
            (Address of principal executive offices)     (Zip Code)

                                 (661) 257-6060
                        (Registrant's telephone number)

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes [X]  No [ ]

Indicate by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a smaller reporting company.

      Large accelerated filer [ ]
      Non-accelerated filer [ ] (Do not check if a smaller reporting company)
      Accelerated filer [ ]
      Smaller reporting company [X]

Indicate by check mark whether the registrant is a shell company (as defined in
Rule 12b-2 of the Exchange Act).
      Yes [ ]  No [X]

Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date:

Class                                       Outstanding on April 30, 2008
-------------------------------------       -----------------------------
Class A common stock, $.001 par value                  4,777,144
Class B common stock, $.001 par value                    762,612


<PAGE>

                                      INDEX

                         PART I - FINANCIAL INFORMATION

Item 1.     Financial Statements (unaudited)

            Condensed Consolidated Balance Sheet at March 31, 2008

            Condensed Consolidated Statements of Operations for the three months
            ended March 31, 2008 and 2007

            Condensed Consolidated Statements of Cash Flows for the three months
            ended March 31, 2008 and 2007

            Notes to Condensed Consolidated Financial Statements

Item 2.     Management's Discussion and Analysis of Financial Condition and
            Results of Operations

Item 3.     Quantitative and Qualitative Disclosures About Market Risk.

Item 4.     Controls and Procedures

                           PART II - OTHER INFORMATION

Item 1.     Legal Proceedings

Item 2.     Unregistered Sales of Equity Securities and Use of Proceeds

Item 3.     Defaults Upon Senior Securities

Item 4.     Submission of Matters to a Vote of Security Holders

Item 5.     Other Information

Item 6.     Exhibits


<PAGE>


PART I - FINANCIAL INFORMATION
Item 1. Financial Statements

                         TAITRON COMPONENTS INCORPORATED

                      Condensed Consolidated Balance Sheet

<TABLE>
<CAPTION>
                                                                                          March 31
                                                                                       -------------
 <S>                                                                                   <C>
                                       Assets                                           (Unaudited)
  Current assets:
      Cash and cash equivalents                                                         $  1,106,000
      Trade accounts receivable, net                                                       1,131,000
      Inventory, net                                                                      14,762,000
      Prepaid expenses and other current assets                                              197,000
                                                                                        ------------
            Total current assets                                                          17,196,000

  Property and equipment, net                                                              5,464,000
  Other assets (Note 3)                                                                      731,000
                                                                                        ------------
            Total assets                                                                $ 23,391,000
                                                                                        ============

                        Liabilities and Shareholders' Equity
  Current liabilities:
      Trade accounts payable                                                             $ 1,013,000
      Accrued liabilities and other                                                          235,000
      Current portion of long-term debt                                                       89,000
                                                                                         -----------
            Total current liabilities                                                      1,337,000

   Long-term debt, less current portion (Note 4)                                             399,000
                                                                                         -----------
            Total liabilities                                                              1,736,000
                                                                                         ===========

  Commitments and contingencies (Note 6)
  Minority interest in subsidiary                                                            251,000

  Shareholders' equity:
      Preferred stock, $.001 par value.  Authorized 5,000,000 shares.
        None issued or outstanding.
        Class A common stock, $.001 par value.  Authorized 20,000,000 shares;                  5,000
        issued and outstanding 4,777,144 shares.
        Class B common stock, $.001 par value.  Authorized, issued and outstanding             1,000
        762,612 shares.
      Additional paid-in capital                                                          10,551,000
      Accumulated other comprehensive income, net of tax                                      19,000
      Retained earnings                                                                   10,828,000
                                                                                        ------------

            Total shareholders' equity                                                    21,404,000
                                                                                        ------------

            Total liabilities and shareholders' equity                                  $ 23,391,000
                                                                                        ============
</TABLE>

     See accompanying notes to condensed consolidated financial statements.


                                       1
<PAGE>

                         TAITRON COMPONENTS INCORPORATED

                 Condensed Consolidated Statements of Operations

<TABLE>
<CAPTION>

                                                                 Three months ended March 31,
                                                                     2008            2007
                                                                 -----------     ------------
<S>                                                             <C>            <C>
                                                                (Unaudited)       (Unaudited)

Net sales                                                        $ 2,005,000     $ 1,855,000
Cost of goods sold                                                 1,395,000       1,355,000
                                                                 -----------     -----------
Gross profit                                                         610,000         500,000

Selling, general and administrative expenses                         687,000         691,000
                                                                 -----------     -----------
Operating loss                                                       (77,000)       (191,000)

Interest income, net                                                   4,000          11,000
Other income, net                                                     46,000          (8,000)
                                                                 -----------     -----------
Loss before income taxes                                             (27,000)       (188,000)

Income tax provision                                                      --          (2,000)
                                                                 -----------     -----------

Net loss                                                         $   (27,000)    $  (190,000)
                                                                 ===========     ===========

Other Comprehensive Loss:
      Foreign currency translation adjustment                        (25,000)         16,000
                                                                 -----------     -----------
Comprehensive loss                                               $   (52,000)    $  (174,000)
                                                                 ===========     ===========
Net loss per share:  Basic & Diluted                             $     (0.00)    $     (0.03)
                                                                 ===========     ===========
Weighted average common shares outstanding:  Basic & Diluted       5,539,423       5,519,701
                                                                 ===========     ===========
</TABLE>


     See accompanying notes to condensed consolidated financial statements.


                                       2
<PAGE>

                         TAITRON COMPONENTS INCORPORATED

                 Condensed Consolidated Statements of Cash Flows

<TABLE>
<CAPTION>
                                                                 Three months ended March 31,
                                                                     2008            2007
                                                                 -----------     ------------
<S>                                                             <C>             <C>
                                                                 (Unaudited)      (Unaudited)
Cash flows from operating activities:
Net loss                                                         $   (27,000)    $  (190,000)
                                                                 -----------     -----------
Adjustments to reconcile net loss to net cash provided by
(used in) operating activities:
      Depreciation and amortization                                   68,000          56,000
      Provision for sales returns and doubtful accounts               36,000          22,000
      Stock based compensation                                         5,000           7,000
      Changes in assets and liabilities:
         Trade accounts receivable                                   283,000        (337,000)
         Inventory                                                    60,000         186,000
         Prepaid expenses and other current assets                   (23,000)       (114,000)
         Other assets                                                (18,000)       (155,000)
         Trade accounts payable                                     (305,000)       (153,000)
         Accrued liabilities                                         (59,000)        (56,000)
         Minority interest in subsidiary                              20,000         124,000
                                                                 -----------     -----------
            Total adjustments                                         67,000        (420,000)
                                                                 -----------     -----------
Net cash provided by (used in) operating activities                   40,000        (610,000)
                                                                 -----------     -----------

Cash flows from investing activities:
      Investments in marketable securities                                --        (305,000)
                                                                 -----------     -----------
Net cash used in investing activities                                     --        (305,000)
                                                                 -----------     -----------

Cash flows from financing activities:
      (Payments) on notes payable                                    (22,000)        (22,000)
      Dividend payments                                                   --        (552,000)
      Exercise of Class A common stock options                         2,000          54,000
                                                                 -----------     -----------
Net cash used in financing activities                                (20,000)       (520,000)
                                                                 -----------     -----------
      Impact of exchange rates on cash                               (25,000)         16,000
                                                                 -----------     -----------
Net decrease in cash and cash equivalents                             (5,000)     (1,419,000)
Cash and cash equivalents, beginning of year                       1,111,000       2,727,000
                                                                 -----------     -----------
Cash and cash equivalents, end of year                           $ 1,106,000     $ 1,308,000
                                                                 ===========     ===========
Supplemental disclosures of cash flow information:
      Cash paid for interest                                         $ 8,000     $    10,000
                                                                 ===========     ===========
      Cash paid for income taxes, net                                $ 1,000     $     1,000
                                                                 ===========     ===========
</TABLE>


     See accompanying notes to condensed consolidated financial statements.


                                       3
<PAGE>

                         TAITRON COMPONENTS INCORPORATED

              Notes to Condensed Consolidated Financial Statements
                                 March 31, 2008
                           (All amounts are unaudited)

Note 1 - Basis of Presentation

      The accompanying unaudited condensed consolidated financial statements of
      Taitron Components Incorporated ("the Company") were prepared in
      accordance with accounting principles generally accepted in the United
      States of America and reflect all adjustments, consisting of normal
      recurring accruals and adjustments, which are, in the opinion of
      management, necessary for a fair presentation of the consolidated
      financial position and results of operations at and for the periods
      presented. Such financial statements do not include all the information or
      notes necessary for a complete presentation. Therefore, they should be
      read in conjunction with our Annual Report on Form 10-KSB for the fiscal
      year ended December 31, 2007, and the notes thereto, which include
      significant accounting policies and estimates. The results of operations
      for the interim periods are not necessarily indicative of results for the
      full year.

Note 2 - Summary of Significant Accounting Policies and Estimates

      Principles of Consolidation

      The unaudited condensed consolidated financial statements includes our 60%
      majority-owned subsidiary, Taitron Components Mexico SA de CV. All
      significant intercompany transactions and balances have been eliminated in
      consolidation.

      Revenue Recognition

      Revenue is typically recognized upon shipment of merchandise and sales are
      recorded net of discounts, rebates, and returns. Reserves for sales
      allowances and customer returns are established based upon historical
      experience and management's estimates as shipments are made. Sales returns
      for the quarters ended March 31, 2008 and 2007 were $30,000 and $17,000,
      respectively.

      Allowance for Sales Returns and Doubtful Accounts

      On a case-by-case basis, we accept returns of products from our customers,
      without restocking charges, when they can demonstrate an acceptable cause
      for the return. Requests by a distributor to return products purchased for
      its own inventory generally are not included under this policy. We will,
      on a case-by-case basis, accept returns of products upon payment of a
      restocking fee, which is generally 15% to 30% of the net sales price. We
      will not accept returns of any products that were special-ordered by a
      customer or that otherwise are not generally included in inventory. The
      allowance for sales returns and doubtful accounts at March 31, 2008
      aggregated $86,000.

      Inventory

      Inventory, consisting principally of products held for resale, is recorded
      at the lower of cost (determined using the first in-first out method) or
      estimated market value. Inventory is presented net of valuation allowances
      of $2,657,000 at March 31, 2008.

      Income Taxes

      In July 2006, the FASB issued FASB Interpretation No. 48, Accounting for
      Uncertainty in Income Taxes--an interpretation of FASB Statement No. 109
      ("FIN 48"), which clarifies the accounting and disclosure for uncertainty
      in tax positions, as defined. FIN 48 seeks to reduce the diversity in
      practice associated with certain aspects of the recognition and
      measurement related to accounting for income taxes. We adopted the
      provisions of FIN 48 as of January 1, 2007, and have analyzed filing
      positions in each of the federal and state jurisdictions where required to
      file income tax returns, as well as all open tax years in these
      jurisdictions. The following tax years that remain subject to examination
      by major tax jurisdictions are as follows: Federal - 2005, 2006 and 2007;
      and California (State) - 2004, 2005, 2006 and 2007. However, we have
      certain tax attribute carryforwards which will remain subject to review
      and adjustment by the relevant tax authorities until the statute of
      limitations closes with respect to the year in which such attributes are
      utilized.


                                       4
<PAGE>

      Net Loss Per Share

      Basic loss per share is computed by dividing net loss available to common
      shareholders by the weighted average number of common shares outstanding
      during the period. Common equivalent shares, consisting primarily of stock
      options, of approximately 370,000 and 381,000 for the three months ended
      March 31, 2008 and 2007, respectively, are excluded from the computation
      of diluted loss per share as their effect is anti-dilutive.

      Use of Estimates

      Management has made a number of estimates and assumptions relating to the
      reporting of assets and liabilities and the disclosure of contingent
      assets and liabilities to prepare these condensed consolidated financial
      statements in conformity with accounting principles generally accepted in
      the United States. These estimates have a significant impact on our
      valuation and reserve accounts relating to the allowance for sales
      returns, doubtful accounts, inventory reserves and deferred income taxes.
      Actual results could differ from these estimates.

      Stock-Based Compensation

      Accounting for stock options issued to employees follows the provisions of
      SFAS No. 123R, "Share-Based Payment". This statement requires an entity to
      measure the cost of employee services received in exchange for an award of
      equity instruments based on the grant-date fair value of the award. That
      cost will be recognized over the period during which an employee is
      required to provide service in exchange for the award. We use the
      Black-Scholes option pricing model to measure the fair value of options
      granted to employees. This model requires significant estimates related to
      the award's expected life and future stock price volatility.

      Stock option activity during the three months ended March 31, 2008 is as
      follows:

<TABLE>
<CAPTION>
                                                                        Weighted
                                                                        Average
                                                           Weighted       Years
                                                           Average      Remaining     Aggregate
                                             Number       Exercise     Contractual    Intrinsic
                                            of Shares       Price         Term          Value
                                            ---------       -----         ----          -----
      <S>                                  <C>            <C>         <C>            <C>
      Outstanding at December 31, 2007        414,167      $ 1.84         4.41        $ 106,000
            Granted                            51,000        1.63         8.01
            Exercised                          (2,000)       1.00           --
            Forfeited                          (1,167)       2.45           --
                                              -------
      Outstanding at March 31, 2008           462,000        1.82         3.78           26,300
                                              =======
      Exercisable at March 31, 2008           368,668        1.76         3.53           26,300
                                              =======
</TABLE>

      At March 31, 2008, the range of individual outstanding weighted average
      exercise prices was $1.74 to $2.45.

      Recent Accounting Pronouncements

      In December 2007, the FASB issued SFAS No. 160, Noncontrolling Interests
      in Consolidated Financial Statements, which is an amendment of Accounting
      Research Bulletin ("ARB") No. 51. This statement clarifies that a
      noncontrolling interest in a subsidiary is an ownership interest in the
      consolidated entity that should be reported as equity in the consolidated
      financial statements. This statement changes the way the consolidated
      income statement is presented, thus requiring consolidated net income to
      be reported at amounts that include the amounts attributable to both
      parent and the noncontrolling interest. This statement is effective for
      the fiscal years, and interim periods within those fiscal years, beginning
      on or after December 15, 2008. We are currently assessing the impact that
      SFAS No. 160 will have on our financial statements.

      In December 2007, the FASB issued SFAS No. 141 (revised 2007), Business
      Combinations. This statement replaces FASB Statement No. 141, Business
      Combinations. This statement retains the fundamental requirements in SFAS
      141 that the acquisition method of accounting (which SFAS 141 called the
      purchase method) be used for all business


                                       5
<PAGE>

      combinations and for an acquirer to be identified for each business
      combination. This statement defines the acquirer as the entity that
      obtains control of one or more businesses in the business combination and
      establishes the acquisition date as the date that the acquirer achieves
      control. This statement requires an acquirer to recognize the assets
      acquired, the liabilities assumed, and any noncontrolling interest in the
      acquiree at the acquisition date, measured at their fair values as of that
      date, with limited exceptions specified in the statement. This statement
      applies prospectively to business combinations for which the acquisition
      date is on or after the beginning of the first annual reporting period
      beginning on or after December 15, 2008. We do not expect the adoption of
      SFAS 141R to have a significant impact on our results of operations or
      financial position.

      In March 2008, the FASB issued SFAS No. 161, Disclosures about Derivative
      Instruments and Hedging Activities, an amendment to FASB Statement No.
      133, which changes the disclosure requirements for derivative instruments
      and hedging activities. SFAS No. 161 requires entities to provide enhanced
      disclosures on how and why the entity uses derivative instruments, how
      derivative instruments and related hedging items are accounted for under
      SFAS No. 133, and how derivative instruments and related hedging items
      affect an entity's financial position, financial performance, and cash
      flows. The provisions of SFAS No. 161 are effective for fiscal years and
      interim periods beginning after November 15, 2008. We do not expect the
      adoption of SFAS No. 161 to have a significant impact on our results of
      operations or financial position.

Note 3 - Other Assets

                                                3/31/2008
                                                ---------
      Investment in securities                  $ 400,000
      Investment in land purchase contract        147,000
      Investment in joint venture                 147,000
      Other                                        37,000
                                                ---------
            Other Assets                        $ 731,000
                                                =========

      Our $400,000 investment in securities as of March 31, 2008 relates to
      approximately 4.5% of the outstanding shares of Zowie Technology
      Corporation, a manufacturer of discrete semiconductors and also a supplier
      of our electronic component products. This investment is accounted for
      under the cost method basis of accounting.

      Our $147,000 investment in land purchase contract as of March 31, 2008,
      represents a deposit on land in Yangzhou, China.

      Our $147,000 investment in joint venture as of March 31, 2008, relates to
      our 49% ownership of Taiteam (Yangzhou) Technology Corporation Limited, a
      joint venture with its 51% owner, Full Harvest Development Limited. This
      joint venture is not considered to be a "Variable Interest Entity", as
      defined under FAS Interpretation No. 46R, and as such, is accounted for
      under the equity method basis of accounting.

Note 4 - Note Payable

                                                                   3/31/2008
                                                                   ---------
       Bank loan collateralized by real property, payable
       in fixed monthly principal installments of $7,381,
       plus interest at the rate of one year LIBOR + 1.8%
       per annum, due September 20, 2013.                          $488,000

            Less current portion                                    (89,000)
                                                                   --------
       Long-term debt, less current portion                        $399,000
                                                                   ========

      On September 21, 2006, we borrowed $620,000 in connection with our
      acquisition of approximately 4,500 square feet of office space (consisting
      of 2 separate units on the same floor) in Shanghai, China with a total
      purchase price of $1,240,000. The investment will be used as rental
      property for lease to others and for our project design and engineering
      center.


                                       6
<PAGE>

Note 5 - Related Party Transactions

      During the period ended March 31, 2008, we purchased electronic component
      products of approximately $288,000 from Princeton Technology Corporation
      ("PTC"), a company controlled by Mr. Chiang, one of our directors. All of
      these purchases were for products we carried in inventory and we consider
      these purchases to be in the normal course of business and negotiated on
      an arm's length basis. We have entered into a distributor agreement with
      PTC, and accordingly, we expect to continue purchasing from PTC in the
      future.

      During the period ended March 31, 2008, we made payments of $6,000, to
      K.S. Best International Co. Ltd., a company controlled by our Chief
      Executive Officer. These payments were for professional fees related to
      the operational management of our Taiwan office.

Note 6 - Commitments and Contingencies

      Inventory Purchasing
      Outstanding commitments to purchase inventory from suppliers aggregated
      $713,000 as of March 31, 2008.

      Cash Dividend
      On March 28, 2008 we declared an annual cash dividend of $0.05 per share
      of Class A Common Stock and Class B Common Stock, payable on April 22,
      2008, to shareholders of record at the close of business on April 15,
      2008. Outstanding commitment to fund this cash dividend payment aggregated
      $277,000 as of March 31, 2008.

      Regulation
      On July 1, 2006, the European Union ("EU") directive relating to the
      Restriction of Certain Hazardous Substance ("RoHS") restricted the
      distribution of products within the EU containing certain substances,
      including lead. Further, many of our suppliers are not yet supplying RoHS
      compliant products. The legislation is effective and some of our inventory
      has become obsolete. Management has estimated the impact of the
      legislation and has written down or reserved for related inventories based
      on amounts expected to be realized given all available current
      information. Actual amounts realized from the ultimate disposition of
      related inventories could be different from those estimated.

      Legal and Regulatory Proceedings
      None.

Note 7 - Subsequent Events

      On April 21, 2008, we entered into a credit facility from K.S. Best
      International Co. Ltd., a company controlled by the brother of our Chief
      Executive Officer, providing up to $3 million for operating purposes at an
      interest rate of Prime + 0.25%, secured by our real property located in
      Valencia, California. As of the date of this Report, we have not yet used
      this credit facility.


                                       7
<PAGE>

Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations.

      The following discussion should be read in conjunction with the condensed
consolidated financial statements, including the related notes, appearing in
Item 1 of this report as well as our most recent annual report on Form 10-KSB
for the year ended December 31, 2007. Also, several of the matters discussed in
this document contain forward-looking statements as defined in the Private
Securities Litigation Reform Act of 1995 that involve risks and uncertainties.
Forward-looking statements usually are denoted by words or phrases such as
"believes," "expects," "projects," "estimates," "anticipates," "will likely
result" or similar expressions. We wish to caution readers that all
forward-looking statements are necessarily speculative and not to place undue
reliance on forward-looking statements, which speak only as of the date made,
and to advise readers that actual results could vary due to a variety of risks
and uncertainties. Factors associated with the forward looking statements that
could cause the forward looking statements to be inaccurate and could otherwise
impact our future results are set forth in detail in our most recent annual
report on Form 10-KSB. In addition to the other information contained in this
document, readers should carefully consider the information contained in our
most recent annual report on Form 10-KSB under the heading "Cautionary
Statements and Risk Factors."

      References to "Taitron," "the Company," "we," "our" and "us" refer to
Taitron Components Incorporated and its majority-owned subsidiary, unless the
context otherwise requires.

Critical Accounting Policies and Estimates

      Use Of Estimates - Management has made a number of estimates and
assumptions relating to the reporting of assets and liabilities and the
disclosure of contingent assets and liabilities to prepare our condensed
consolidated financial statements in conformity with accounting principles
generally accepted in the United States. These estimates have a significant
impact on our valuation and reserve accounts relating to the allowance for sales
returns, doubtful accounts, inventory reserves and deferred income taxes. Actual
results could differ from these estimates.

      Revenue Recognition - Revenue is recognized upon shipment of the
merchandise, which is when legal transfer of title occurs. Reserves for sales
allowances and customer returns are established based upon historical experience
and our estimates of future returns. Sales returns for the quarters ended March
31, 2008 were $30,000 and $17,000, respectively. The allowance for sales returns
and doubtful accounts at March 31, 2008 aggregated $86,000.

      Inventory - Inventory, consisting principally of products held for resale,
is recorded at the lower of cost (determined using the first in-first out
method) or estimated market value. We had inventory balances in the amount of
$14,762,000 at March 31, 2008, which is presented net of valuation allowances of
$2,657,000. We evaluate inventories to identify excess, high-cost, slow-moving
or other factors rendering inventories as unmarketable at normal profit margins.
Due to the large number of transactions and the complexity of managing and
maintaining a large inventory of product offerings, estimates are made regarding
adjustments to the cost of inventories. Based on our assumptions about future
demand and market conditions, inventories are carried at the lower of cost or
estimated market value. If our assumptions about future demand change, or market
conditions are less favorable than those projected, additional write-downs of
inventories may be required. In any case, actual amounts could be different from
those estimated.

      Impact of Governmental Regulation - Our worldwide operations are subject
to local laws and regulations. As such, of particular interest is the European
Union ("EU") directive relating to the Restriction of Certain Hazardous
Substance ("RoHS"). On July 1, 2006, this directive restricted the distribution
of products within the EU containing certain substances, including lead. At the
present time, much of our inventory contains substances prohibited by the RoHS
directive. Further, many of our suppliers are not yet supplying RoHS compliant
products. The legislation is effective and some of our inventory has become
obsolete. Management has estimated the impact of the legislation and have
written down or reserved for related inventories based on amounts expected to be
realized given all available current information. Actual amounts realized from
the ultimate disposition of related inventories could be different from those
estimated.

      Deferred Taxes - In June 2006, FASB issued Interpretation No. 48,
Accounting for Uncertainty in Income Taxes (FIN48), which defines the threshold
for recognizing the benefits of tax return positions in the financial statements
as "more-likely-than-not" to be sustained by the taxing authority. A tax
position that meet the "more-likely-than-not" criterion shall be measured at the
largest amount of benefit that is more than 50% likely of being realized upon
ultimate settlement. FIN48 applies to all tax positions accounted for under SFAS
No. 109, Accounting for Income Taxes. FIN48 is effective for fiscal years
beginning after December 15, 2006. We adopted FIN48 as of January 1, 2007. Based
on our preliminary analysis, we


                                       8
<PAGE>

believe that our income tax filing positions and deductions will be sustained on
audit and do not anticipate any adjustments that will result in a material
change to our financial position including our effective tax rate. Therefore, no
reserves for uncertain income tax positions have been recorded pursuant to FIN
48 and we did not record a cumulative effect adjustment related to the adoption
of FIN 48. In addition, we have not recorded any accrued interest nor penalties
related to income tax. It is our policy to classify interest and penalties
related to income tax as income taxes in our financial statements. The following
tax years that remain subject to examination by major tax jurisdictions are as
follows: Federal - 2005, 2006 and 2007; and California (State) - 2004, 2005,
2006 and 2007.

Overview

      We distribute discrete semiconductors, optoelectronic devices and passive
components to other electronic distributors, CEMs and OEMs, who incorporate them
in their products and supply ODM products for our customer's multi-year turn-key
projects.

      We continue to be impacted by the severe decline in demand for discrete
semiconductors from the U.S. market, which began in late 2000. As a result, we
have experienced declining sales in such components since early 2001. In
response to this declining demand, we placed emphasis on increasing our sales to
existing customers through further expansion of the number of different types of
discrete components and other integrated circuits in our inventory and by
attracting additional contract electronic manufacturers (CEMs), original
equipment manufacturers (OEMs) and electronics distributor customers. In
addition, over the last four years we have developed our ODM service
capabilities and added products developed through partnership agreements with
offshore solution providers (OEMs and CEMs). Looking forward, we plan to offer
commodity Integrated Circuits (ICs) as an extension of current discrete
semiconductor lines in 2008.

      Our core strategy of electronic components fulfillment, however, consists
of carrying a substantial quantity and variety of products in inventory to meet
the rapid delivery requirements of our customers. This strategy allows us to
fill customer orders immediately from stock on hand. Although we believe better
market conditions may return, we are focused on lowering our inventory balances
and increasing our cash holdings. Our long-term strategy is to rely not only on
our core strategy of component fulfillment service, but also the value-added
engineering and turn-key services.

      In accordance with Generally Accepted Accounting Principles, we have
classified inventory as a current asset in our March 31, 2008, consolidated
financial statements representing approximately 86% of current assets and 63% of
total assets. However, if all or a substantial portion of the inventory was
required to be immediately liquidated, the inventory would not be as readily
marketable or liquid as other items included or classified as a current asset,
such as cash. We cannot assure you that demand in the discrete semiconductor
market will increase and that market conditions will improve. Therefore, it is
possible that further declines in our carrying values of inventory may result.

      Since the beginning of 2001, our gross profit margins in general have been
stable. Our gross profit margins are subject to a number of factors, including
product demand, strength of the U.S. dollar, our ability to purchase inventory
at favorable prices and our sales product mix.

Results of Operations

First quarter of 2008 versus first quarter of 2007.

      Net sales in the first quarter of 2008 totaled $2,005,000 versus
$1,855,000 in the comparable period for 2007, an increase of $150,000 or 8.1%
over the same period last year. The overall increase came from our ODM Product
sales increasing by $210,000, when comparing $210,000 for the first quarter of
2008 with $0 in the same period last year.

      Gross profit for the first quarter of 2008 was $610,000 versus $500,000 in
the comparable period for 2007, and gross margin percentage of net sales was
30.4% in the first quarter of 2008 versus 26.9% in the comparable period for
2007. The increase was attributed to the increase in our ODM product sales,
which earn a higher average gross margin relative to our component product sales
mix.

      Selling, general and administrative ("SG&A") expenses in the first quarter
of 2008 totaled $687,000 versus $691,000 in the comparable period for 2007.
Effective January 1, 2006, we adopted SFAS 123(R) and such had a $5,000
financial impact to our SG&A for the first quarter of 2008, as compared to
$7,000 financial impact for the same period last year.


                                       9
<PAGE>

      Interest income, net of interest expense, was $4,000 for the first quarter
of 2008 versus $11,000 in the comparable period for 2007.

      Income tax provision was $0 for the first quarter of 2008 and $2,000 in
the comparable period for 2007, as we do not expect significant taxable income
for fiscal year 2008.

      Net loss was $27,000 for the first quarter of 2008 versus $190,000 in the
comparable period for 2007, a decrease of $163,000 resulting from the reasons
discussed above.

Liquidity and Capital Resources

      We have satisfied our liquidity requirements principally through cash
generated from operations and short-term commercial loans. A summary of our cash
flows resulting from our operating, investing and financing activities for the
three months ended March 31, 2008 are as follows:

                                             Three months ended March 31,
                                           --------------------------------
                                               2008                2007
                                           ------------        ------------
                                            (Unaudited)         (Unaudited)
      Operating activities..............        40,000            (610,000)
      Investing activities..............            --            (305,000)
      Financing activities..............       (20,000)           (520,000)

      Cash flows provided by (used in) operating activities were $40,000 and
$(610,000) for the three months ended March 31, 2008 and 2007, respectively. The
increase of $650,000 in cash flows provided by operations compared with the
prior period resulted from changes in operating assets and liabilities,
primarily collections of accounts receivable.

      Cash flows used in investing activities were $0 and $305,000 for the three
months ended March 31, 2008 and 2007, respectively. The 2007 outflows came from
our $305,000 investment in the preferred stock of Zowie Technology Corporation.

      Cash flows used in financing activities were $20,000 and $520,000 for the
three months ended March 31, 2008 and 2007, respectively. The 2007 outflows came
primarily from our cash dividend payment $552,000 paid in the first quarter of
2007.

      Inventory is included in current assets; however, it will take over one
year for the inventory to turn. Hence, inventory would not be as readily
marketable or liquid as other items included in current assets, such as cash.

      We believe that funds generated from, or used in operations, in addition
to existing cash balances are likely to be sufficient to finance our working
capital and capital expenditure requirements for the foreseeable future. If
these funds are not sufficient, we may secure new sources of short-term
commercial loans, asset-based lending on accounts receivables or issue debt or
equity securities.

Off-Balance Sheet Arrangements

As of March 31, 2008, we had no off-balance sheet arrangements.

Item 3.  Quantitative and Qualitative Disclosures About Market Risk.

         None.

Item 4.  Controls and Procedures.


Evaluation of Disclosure Controls and Procedures
         Under the supervision and with the participation of our management,
including our Chief Executive and Chief Financial Officer, we evaluated the
effectiveness of our disclosure controls and procedures (as defined in the Rules
13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended
(the "Exchange Act")) required by Exchange Act


                                       10
<PAGE>

Rules 13a-15(b) or 15d-15(b), as of the end of the period covered by this
report. Based upon that evaluation, our Chief Executive Officer and Chief
Financial Officer concluded that our disclosure controls and procedures were
effective as of that date to provide reasonable assurance that information we
are required to disclose in reports that we file or submit under the Exchange
Act is recorded, processed, summarized and reported within the time periods
specified in SEC rules and forms, and include controls and procedures designed
to ensure that information required to be disclosed by us in such reports is
accumulated and communicated to our management, including the principal
executive officer and principal financial officer, as appropriate to allow
timely decisions regarding required disclosures.

Evaluation of Changes in Internal Control over Financial Reporting
         Pursuant to Rule 13a-15(d) or Rule 15d-15(d) of the Exchange Act, our
management, including our Chief Executive and Chief Financial Officer, is
responsible for evaluating any change in our internal control over financial
reporting (as defined in Rule 13a-15(f) or Rule 15d-15(f) under the Exchange
Act), that occurred during each of our fiscal quarters that has materially
affected, or is reasonably likely to materially affect, our internal control
over financial reporting.

         Our internal control over financial reporting is designed to provide
reasonable assurance regarding the reliability of financial reporting and the
preparation of financial statements for external purposes in accordance with
generally accepted accounting principles and includes those policies and
procedures that: (i) Pertain to the maintenance of records that in reasonable
detail accurately and fairly reflect the transactions and dispositions of our
assets; (ii) Provide reasonable assurance that transactions are recorded as
necessary to permit preparation of financial statements in accordance with
generally accepted accounting principles, and that our receipts and expenditures
are being made only in accordance with authorizations of our management and
directors; and (iii) Provide reasonable assurance regarding prevention or timely
detection of unauthorized acquisition, use or disposition of our assets that
could have a material effect on the financial statements. Our internal controls
framework is based on the criteria set forth in the Internal Control -
Integrated Framework issued by the Committee of Sponsoring Organizations of the
Treadway Commission (COSO).

         Under the supervision and with the participation of our management,
including our Chief Executive and Chief Financial Officer, we have determined
that, during the period covered by this report, there were no changes in our
internal control over financial reporting that have materially affected, or are
reasonably likely to materially affect, our internal control over financial
reporting.

PART II - OTHER INFORMATION

Item 1.  Legal Proceedings.

         None.

Item 2.  Unregistered Sales of Equity Securities and Use of Proceeds.

         There were no issuances or sales of our securities by us during the
quarter ended March 31, 2008 that were not registered under the Securities Act.

Item 3.  Defaults Upon Senior Securities.

         None.

Item 4.  Submission of Matters to a Vote of Security Holders.

         None.

Item 5.  Other Information.

         None.

Item 6.  Exhibits.

Exhibit
Number         Description of Document
------------  ------------------------------------------------------------------

31 *           Rule 13a-14(a)/ 15d-14(a) Certification pursuant to Section 302
               of the Sarbanes-Oxley Act
32 *           18 U.S.C. section 1350 Certification pursuant to Section 906 of
               the Sarbanes-Oxley Act
*              File herewith.


                                       11
<PAGE>

SIGNATURES

      Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.

                                            TAITRON COMPONENTS INCORPORATED


Date:  May 15, 2008                     By: /s/ Stewart Wang
                                            ----------------
                                            Stewart Wang
                                            Chief Executive Officer, President,
                                            Chief Financial Officer and Director
                                            (Principal Executive, Financial and
                                            Accounting Officer)


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