As of Thursday last week, the Ministry of Finance had received applications to repatriate NT$207.6 billion (US$7.03 billion) in overseas funds since a repatriation law took effect on Aug. 15 last year, the Liberty Times (the Taipei Times’ sister newspaper) reported on Saturday, citing Minister of Finance Su Jain-rong (蘇建榮).
The amount would be NT$210 billion if applications filed on Friday were included, Su told a news conference in Taipei on Friday.
The legislature passed the Act on the Use of and Taxation on Inward Remittances of Overseas Funds (境外資金匯回管理運用及課稅條例) in early July last year.
It provides a tax rate of 8 percent in the first year and 10 percent in the second year for repatriated funds, with further reductions to a preferential rate of 4 percent in the first year and 5 percent in the second year if the funds are returned and invested on time.
The regulations remain valid for two years as part of government incentives to help individuals and for-profit enterprises rebalance their international investments and encourage them to return funds to Taiwan.
The ministry had earlier estimated that there would be applications to repatriate NT$133.3 billion in the year following promulgation of the law.
Su said that since the implementation of the law, 154 applications have been received and NT$46.7 billion has been invested in local industries, mainly in the information and communications industry.
He said that due to the impact of the US-China trade dispute and the COVID-19 pandemic, there have been gradual shifts in the world’s industrial supply chains.
From last month to this month, there were applications to repatriate NT$2 billion to NT$3 billion every day, he said.
In particular, as the anti-tax avoidance directive on controlled foreign company rules are expected to take effect after the repatriation law has been phased out, Taiwanese businesspeople would be affected, therefore they should repatriate their funds and relocate supply chains home as soon as possible, he added.
In the first year under the repatriation law, most enterprises returned their funds through overseas banking unit accounts, while others repatriated them from entities overseas, the ministry said.
As for wealthy individuals, funds were sent back from overseas companies, Hong Kong and other places, the ministry added.
Meanwhile, the ministry has so far turned down 10 repatriation applications, including three from individuals and seven from companies, as some of them did not comply with regulations, while others had fund-management issues, the ministry said.
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