Offshore securities units likely to be in line for tax breaks

By Amy Su  /  Staff reporter

Fri, Nov 09, 2012 - Page 14

The nation’s offshore securities units (OSU) may enjoy the same tax breaks as offshore banking units in the near future with the Ministry of Finance and the Financial Supervisory Commission likely to reach a consensus by Tuesday at the earliest.

This may encourage more financial institutions to undertake overseas business in Taiwan, helping raise economic growth and offering additional job openings for financial professionals and increasing tax revenues by NT$1.3 billion (US$44.52 million) a year, the commission’s report showed.

Last month, the ministry and the commission established a taskforce to review seven financial services taxation issues raised by representatives from the sector, with three meetings already held.

“The taskforce will discuss and make a decision on the tax-exemption issue of OSU with the commission next week,” Minister of Finance Chang Sheng-ford (張盛和) said in a legislative question-and-answer session yesterday.

Despite tax breaks potentially lowering revenue from business tax and business income tax by NT$10.13 million a year, the move could boost the market and help the government generate higher overall tax revenues, the commission’s report said.

Other than the OSU-related issue, Chang said the ministry has been reaching a primary consensus with the commission on the other two proposals — cutting the stock transaction tax for brokerages when they trade warrants for hedging purposes and widening the cost identification for financial institutions, with only minor concerns still requiring further discussion.