The US House of Representatives yesterday passed the US-Taiwan Expedited Double-Tax Relief Act by a 423 to 1 vote.
The bill is to be first sent to the US Senate to vote on before being sent to the US president for his signature to be passed into legislation.
The act would first exempt taxation for qualified Taiwanese residents who provide services in the US, and offer a lower withholding tax rate for qualified Taiwanese residents with particular types of US-sourced income such as dividends or interest.
Photo: AFP
Second, the United States-Taiwan Tax Agreement Authorization Act would improve tax cooperation between the two countries, granting the US president authority to negotiate and establish a tax agreement with Taiwan.
Taiwan has been pushing for a double taxation agreement in recent years to benefit businesses on both sides of the Pacific.
It failed to pass in the previous session.
The act “paves the way for increased Taiwanese investment in the US economy,” the New Democrat Coalition of the House said in a joint statement.
As the US and Taiwan have no formal diplomatic relations, for decades there have been no tax agreement, forcing individuals to pay taxes to both governments if they live or work in both nations and giving Taiwanese businesses “an excessively high withholding tax when compared to other close trading partners,” the coalition said.
The bill aims to “lower costs on cross-border investment, help expand domestic production of key technologies including chips and create high-paying jobs in communities across the [US],” it said.
As Taiwan is one of the US’ largest trade partners, the act would “unleash American manufacturing jobs, support [US] semiconductor and chip manufacturing capabilities and secure strategic supply chains, while reducing [US] dependence on China,” House Committee on Ways and Means Chairman Jason Smith wrote on X.
Without the agreement, US employees sent to Taiwan for training at semiconductor factories would have to pay double taxes on their income, US House Representative Judy Chu (趙美心) said.
The US has already signed double taxation agreements with more than 60 countries, but due to Taiwan’s unique political position it cannot partake in traditional tax agreements, making Taiwan the only one of the US’ top 10 trade partners without such an agreement, she added.
Chu said that Taiwanese businesses have told her that in the face of large tax bills, they have reduced investment in the US.
A survey conducted by the American Institute in Taiwan found that 79 percent of respondents agreed that double taxation was a deterrent to US investments, she added.
In light of the House passing the bill, President William Lai (賴清德) said he hoped that Legislative Speaker Han Kuo-yu (韓國瑜), who is leading a delegation to attend the US presidential inauguration next week, could mark this new milestone in Taiwan-US relations in Washington.
UPDATED (3:40pm): A suspected gas explosion at a shopping mall in Taichung this morning has killed four people and injured 20 others, as emergency responders continue to investigate. The explosion occurred on the 12th floor of the Shin Kong Mitsukoshi in Situn District (西屯) at 11:33am. One person was declared dead at the scene, while three people were declared deceased later after receiving emergency treatment. Another 20 people sustained major or minor injuries. The Taichung Fire Bureau said it received a report of the explosion at 11:33am and sent rescuers to respond. The cause of the explosion is still under investigation, it said. The National Fire
ACCOUNTABILITY: The incident, which occured at a Shin Kong Mitsukoshi Department Store in Taichung, was allegedly caused by a gas explosion on the 12th floor Shin Kong Group (新光集團) president Richard Wu (吳昕陽) yesterday said the company would take responsibility for an apparent gas explosion that resulted in four deaths and 26 injuries at Shin Kong Mitsukoshi Zhonggang Store in Taichung yesterday. The Taichung Fire Bureau at 11:33am yesterday received a report saying that people were injured after an explosion at the department store on Section 3 of Taiwan Boulevard in Taichung’s Situn District (西屯). It sent 56 ambulances and 136 paramedics to the site, with the people injured sent to Cheng Ching Hospital’s Chung Kang Branch, Wuri Lin Shin Hospital, Taichung Veterans General Hospital or Chung
‘TAIWAN-FRIENDLY’: The last time the Web site fact sheet removed the lines on the US not supporting Taiwanese independence was during the Biden administration in 2022 The US Department of State has removed a statement on its Web site that it does not support Taiwanese independence, among changes that the Taiwanese government praised yesterday as supporting Taiwan. The Taiwan-US relations fact sheet, produced by the department’s Bureau of East Asian and Pacific Affairs, previously stated that the US opposes “any unilateral changes to the status quo from either side; we do not support Taiwan independence; and we expect cross-strait differences to be resolved by peaceful means.” In the updated version published on Thursday, the line stating that the US does not support Taiwanese independence had been removed. The updated
‘LAWFUL USE’: The last time a US warship transited the Taiwan Strait was on Oct. 20 last year, and this week’s transit is the first of US President Donald Trump’s second term Two US military vessels transited the Taiwan Strait from Sunday through early yesterday, the Ministry of National Defense said in a statement, the first such mission since US President Donald Trump took office last month. The two vessels sailed south through the Strait, the ministry said, adding that it closely monitored nearby airspace and waters at the time and observed nothing unusual. The ministry did not name the two vessels, but the US Navy identified them as the Arleigh Burke-class guided-missile destroyer USS Ralph Johnson and the Pathfinder-class survey ship USNS Bowditch. The ships carried out a north-to-south transit from
RSS