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