The Department of Finance on Friday welcomed any possibility of negotiating a tax agreement with the United States involving the reduction of double taxation.
However, the ministry said negotiations would not begin until the two sides shared “similar ideas” on the matter.
The ministry’s remarks came a week after two US senators introduced a draft resolution urging US President Joe Biden’s administration to begin negotiating such a deal with Taiwan.
Photo: Ritchie B. Tongo, EPA-EFE
According to the proposed resolution, an income tax agreement between Taiwan and the United States “could boost bilateral trade and investment by reducing double taxation and increasing economic efficiency and integration.”
A ministry official said Taiwan and the United States had previously signed tax-related agreements, including a transport income tax agreement in 1988.
However, the two countries have not entered into a comprehensive reciprocal tax treaty providing for the reduction or elimination of double taxation of individuals and companies with operations in each other’s countries, the official said, speaking on condition of anonymity.
Taiwan has tax agreements with 34 countries, including Canada, France, India, Japan and Canada.
On July 21, U.S. Senators Chris Van Hollen and Ben Sasse introduced a resolution in the U.S. Congress, urging the Biden administration to begin negotiating a tax deal with Taiwan.
“For decades, Taiwan has been a key economic partner of the United States. Yet, right now, Taiwanese and US companies are being taxed twice due to the lack of a formal joint tax agreement,” Van Hollen said in a July 22 press release.
“It makes sense that we negotiate a tax deal that can benefit both U.S. and Taiwanese companies doing business in each other’s countries,” Sasse said.
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