The government should make efforts to improve bilateral cooperation with the US in the field of digital technology and advanced manufacturing after a tax cut bill was passed by the US Congress, pundits said last week.
Under the legislation, the federal corporate tax rate will fall from 35 percent to 21 percent and the maximum individual income tax rate from 39.6 percent to 37 percent, according to international news agencies.
The tax overhaul is expected to lure overseas US capital back to the US and further help improve the country’s domestic manufacturing environment, Chung-Hua Institution for Economic Research Regional Development Study Center director Liu Da-nien (劉大年) said on Thursday.
Some Taiwanese businesses might shift their investment to the US, Liu said, citing Hon Hai Precision Industry Co’s (鴻海精密) decision to invest in Wisconsin because of the incentives offered by the state.
As Taiwan is also about to launch a series of tax reforms, Liu said the nation should learn something from the US, deepen Taiwan-US tax and trade agreements to raise Taiwan’s competitiveness and take initiative in cooperation with the US in digital and advanced manufacturing industries.
After the tax reforms, the US would attract more foreign capital, National Chengchi University (NCCU) Department of Money and Banking professor Norman Yin (殷乃平) said.
Citing Hon Hai as an example, he said that capital inflows to the US would affect emerging markets, could squeeze such countries’ capital movement and result in an interest rate rise.
The effect of US tax reform on Taiwan should be limited, Academia Sinica research fellow Ray Chou (周雨田) said on Friday.
While it is expected to lure overseas capital back to the US and help further improve the domestic manufacturing environment, it is unlikely that Taiwan’s small and medium-sized enterprises would relocate to the US, Chou said yesterday.
“It takes a lot of resources for such a move. Only conglomerates are capable of doing it,” Chou said, adding that big companies like Formosa Plastics Group (台塑集團) and Hon Hai are already investing in the US regardless of the tax reform bill.
Ellen Ting (丁傳倫), a partner at KPMG in Taiwan, said that whether the US tax reform would attract more investments by Taiwanese companies would depend on the firms.
Taiwanese businesses are flexible and focused on meeting the specific needs of their customers on time, and if there were major demand from the US market, more Taiwan companies would consider setting up plants there, she said.
However, companies must also weigh issues such as labor costs, production costs and supply chains in each market, she added.
Minister of Economic Affairs Shen Jong-chin (沈榮津) said that big companies with overseas investments might need to adjust their global strategies in light of the US tax revamp.
More time is needed to gauge the impact of the US tax reform on Taiwan, as no signs of volatile capital movement have been seen in the local stock market, Financial Supervisory Commission Chairman Wellington Koo (顧立雄) said.
Among the rows of vibrators, rubber torsos and leather harnesses at a Chinese sex toys exhibition in Shanghai this weekend, the beginnings of an artificial intelligence (AI)-driven shift in the industry quietly pulsed. China manufactures about 70 percent of the world’s sex toys, most of it the “hardware” on display at the fair — whether that be technicolor tentacled dildos or hyper-realistic personalized silicone dolls. Yet smart toys have been rising in popularity for some time. Many major European and US brands already offer tech-enhanced products that can enable long-distance love, monitor well-being and even bring people one step closer to
Malaysia’s leader yesterday announced plans to build a massive semiconductor design park, aiming to boost the Southeast Asian nation’s role in the global chip industry. A prominent player in the semiconductor industry for decades, Malaysia accounts for an estimated 13 percent of global back-end manufacturing, according to German tech giant Bosch. Now it wants to go beyond production and emerge as a chip design powerhouse too, Malaysian Prime Minister Anwar Ibrahim said. “I am pleased to announce the largest IC (integrated circuit) Design Park in Southeast Asia, that will house world-class anchor tenants and collaborate with global companies such as Arm [Holdings PLC],”
TRANSFORMATION: Taiwan is now home to the largest Google hardware research and development center outside of the US, thanks to the nation’s economic policies President Tsai Ing-wen (蔡英文) yesterday attended an event marking the opening of Google’s second hardware research and development (R&D) office in Taiwan, which was held at New Taipei City’s Banciao District (板橋). This signals Taiwan’s transformation into the world’s largest Google hardware research and development center outside of the US, validating the nation’s economic policy in the past eight years, she said. The “five plus two” innovative industries policy, “six core strategic industries” initiative and infrastructure projects have grown the national industry and established resilient supply chains that withstood the COVID-19 pandemic, Tsai said. Taiwan has improved investment conditions of the domestic economy
Sales in the retail, and food and beverage sectors last month continued to rise, increasing 0.7 percent and 13.6 percent respectively from a year earlier, setting record highs for the month of March, the Ministry of Economic Affairs said yesterday. Sales in the wholesale sector also grew last month by 4.6 annually, mainly due to the business opportunities for emerging applications related to artificial intelligence (AI) and high-performance computing technologies, the ministry said in a report. The ministry forecast that retail, and food and beverage sales this month would retain their growth momentum as the former would benefit from Tomb Sweeping Day