alt Hacker NewsThe main reason for that is because they know that if they did declare that formally (rather than just acting like it is already a fact) that China would most likely immediately respond with force. So this is not because they want it to be like that but because they are playing a longer game.
With the US unreliable and distracted all bets are off on how this will unfold, the chances China attempting to take over Taiwan have substantially increased.
It's unclear how China would have responded because they were not, and probably still aren't, in a position to mount a successful attack on Taiwan.
I think what's missing is that opinion in Taiwan in actually split. The KMT, certainly up to the last president in 2016 is simply opposed to declaring "independence" because they share the position that Taiwan is China, just obviously not the PRC.