Taiwan’s business leaders on Tuesday called on the government to speed up negotiations with Washington on double tax avoidance and investment protections as companies consider investment in the US to cope with tariff hikes.
The Taipei-based Chinese National Association of Industry and Commerce (CNAIC, 工商協進會) made the plea during a forum to discuss business challenges under US President Donald Trump’s second term.
“The government should create a task force to tackle semiconductor and national security, and other issues with the US, rather than leaving companies to cope with these challenges alone,” association vice chairman Huang Chiao-chang (黃教漳) said, adding that Taiwan has grown increasingly reliant on the US market.
Photo: CNA
Taiwan is the US’ sixth-largest trading partner with a trade surplus of US$73.9 billion last year, making it a potential target of tariff hikes, Huang said.
He urged the government to pursue a US-Taiwan trade agreement to reduce tax burdens on Taiwanese firms investing and operating in the US, adding that the two sides should also sign an investment protection pact to safeguard Taiwanese investments in the US.
Taiwan’s negotiators should seek tariff exemptions or tariff reductions wherever possible, he said.
In addition, the government should enhance economic, technological and innovation cooperation with the US, and help boost the competitiveness of local companies on the world stage, Huang said.
The Trump administration has announced plans to impose 25 percent tariffs on Canada and Mexico and has made known its intention to introduce “reciprocal tariffs” that could affect Taiwan’s technology, electronics and semiconductor industries.
Taiwan places a 5 percent tariff on US goods, while the US levies about 3 percent tariffs on Taiwanese imports, CNAIC standing board director Steve Pan (潘思亮) said.
If the US insists on reciprocal tariffs, Taiwan’s agricultural exports would be hit the hardest due to their thin margins, Pan said.
Trump could pressure Taiwan’s tech firms to invest in the US, which would have a greater impact, but appears inevitable in resolving the trade imbalance, he said.
The development of artificial intelligence would be a key growth driver in the US economy, which could benefit local firms in the supply chain, Pan added.
Taiwanese firms should leverage investments in the US to enhance ties with US customers, he said, adding that competitors from South Korea and elsewhere would seek to fill that void if local firms do not.
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