Feng Tay Enterprises Co (豐泰企業), a key supplier of Nike Inc, yesterday said it does not expect back tax issues at its two subsidiaries in China’s Fujian Province to affect its operations.
“Feng Tay will plead not guilty” to tax avoidance, company spokeswoman Amy Chen (陳麗琴) said by telephone, adding that the four shoemaking plants in Fujian only account for about 13 percent of the company’s total capacity.
Fujian tax authorities have claimed that the company should pay corporate income taxes because of transfer pricing problems, Feng Tay said in a filing with the Taiwan Stock Exchange earlier this week.
Transfer pricing is often used as a tool for corporate tax avoidance, indicating the allocation of the price for products and services sold among legal entities within a multinational corporation.
Feng Tay’s two subsidiaries in Fujian should be seen as subjects of taxation, as they not only manufactured shoes, but also directly received orders from clients from 2006 to 2013, the Chinese tax authorities said in a notice.
Chen rejected the claims, saying that Feng Tay’s headquarters in Yunlin County is the major operating entity that takes charge of material purchases and product sales.
For the time being, Feng Tay might reduce production at its Fujian plans and boost output at its factories in India and Indonesia, Daiwa Capital Markets Inc said in a client note on Thursday.
Vietnam accounts for about 52 percent of the company’s total capacity, while India and Indonesia contribute 23 percent and 12 percent respectively, company data showed.
Daiwa said the potential tax payment is likely to affect Feng Tay’s earnings next year by between 10 and 12 percent, although the company still targets an annual capacity increase of between 7 and 10 percent in the near future.
Feng Tay shares dropped 2.41 percent to close at NT$121.50 in Taipei trading yesterday, underperforming the TAIEX, which fell 0.36 percent.
CHIP RACE: Three years of overbroad export controls drove foreign competitors to pursue their own AI chips, and ‘cost US taxpayers billions of dollars,’ Nvidia said China has figured out the US strategy for allowing it to buy Nvidia Corp’s H200s and is rejecting the artificial intelligence (AI) chip in favor of domestically developed semiconductors, White House AI adviser David Sacks said, citing news reports. US President Donald Trump on Monday said that he would allow shipments of Nvidia’s H200 chips to China, part of an administration effort backed by Sacks to challenge Chinese tech champions such as Huawei Technologies Co (華為) by bringing US competition to their home market. On Friday, Sacks signaled that he was uncertain about whether that approach would work. “They’re rejecting our chips,” Sacks
It is challenging to build infrastructure in much of Europe. Constrained budgets and polarized politics tend to undermine long-term projects, forcing officials to react to emergencies rather than plan for the future. Not in Austria. Today, the country is to officially open its Koralmbahn tunnel, the 5.9 billion euro (US$6.9 billion) centerpiece of a groundbreaking new railway that will eventually run from Poland’s Baltic coast to the Adriatic Sea, transforming travel within Austria and positioning the Alpine nation at the forefront of logistics in Europe. “It is Austria’s biggest socio-economic experiment in over a century,” said Eric Kirschner, an economist at Graz-based Joanneum
BUBBLE? Only a handful of companies are seeing rapid revenue growth and higher valuations, and it is not enough to call the AI trend a transformation, an analyst said Artificial intelligence (AI) is entering a more challenging phase next year as companies move beyond experimentation and begin demanding clear financial returns from a technology that has delivered big gains to only a small group of early adopters, PricewaterhouseCoopers (PwC) Taiwan said yesterday. Most organizations have been able to justify AI investments through cost recovery or modest efficiency gains, but few have achieved meaningful revenue growth or long-term competitive advantage, the consultancy said in its 2026 AI Business Predictions report. This growing performance gap is forcing executives to reconsider how AI is deployed across their organizations, it said. “Many companies
France is developing domestic production of electric vehicle (EV) batteries with an eye on industrial independence, but Asian experts are proving key in launching operations. In the Verkor factory outside the northern city of Dunkirk, which was inaugurated on Thursday, foreign specialists, notably from South Korea and Malaysia, are training the local staff. Verkor is the third battery gigafactory to open in northern France in a region that has become known as “Battery Valley.” At the Automotive Energy Supply Corp (AESC) factory near the city of Douai, where production has been under way for several months, Chinese engineers and technicians supervise French recruits. “They
RSS