21/07/23

INTERNATIONAL TAX: House introduces Taiwan tax bill

As published on: taipeitimes.com, Friday 21 July, 2023.

The US House of Representatives’ Committee on Foreign Affairs on Wednesday introduced a bipartisan bill that would authorize US President Joe Biden’s administration to enter into negotiations with Taiwan on tax issues, including the avoidance of double taxation.

The Taiwan Tax Agreement Act of 2023, which aims to facilitate investment, protect against tax evasion and allow businesses in the US and Taiwan to avoid double taxation, was introduced by Republican Representative Michael McCaul, chairman of the committee, and Democratic representatives Gregory Meeks and Gerry Connolly.

“I am proud to introduce this important, bipartisan legislation that will strengthen our economic relationship with Taiwan,” McCaul said in a statement issued by his office.

“In addition to the advantages we will receive from more investment from Taiwan, this is another important step in safeguarding Taiwan and maintaining peace and stability in the Indo-Pacific,” he said.

According to the bill, the US president must provide written notification to the “appropriate congressional committees” of the commencement of negotiations between the American Institute in Taiwan (AIT) and the Taipei Economic and Cultural Representative Office (TECRO) on a tax agreement at least 15 calendar days before the agreement’s commencement.

Under the bill, not later than 90 days after the commencement of negotiations on the agreement, and every 180 days until the conclusion of the agreement, the US president must provide a briefing to the appropriate congressional committees on the status of negotiations.

It also stipulates that the tax agreement would not take effect until after Congress passes a concurrent resolution of approval.

So far, the US has signed tax agreements covering 65 jurisdictions to facilitate economic activity, boost bilateral cooperation, and benefit US businesses and other US taxpayers.

The Taiwan Tax Agreement Act of 2023 that the House of Representatives introduced on Wednesday has a companion bill introduced in the Senate by bipartisan lawmakers Bob Menendez, Jim Risch, Chris Van Hollen and Mitt Romney in May, where it was approved by the Senate Committee on Foreign Relations on July 13.

The tax agreement bill needs to be passed by the House and the Senate before it can be signed into law by the US president.

 

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International Tax Taiwan