The Straits Exchange Foundation (SEF) on Wednesday expressed satisfaction with a recent decision by China’s State Council to reinstate preferential treatment, including tax breaks, for Taiwan-invested companies in China.
Foundation Vice Chairman Chou Jih-shine (周繼祥) said the decision was an indication that China attaches great importance to Taiwanese businesses operating there.
However, Chou said that he hopes China will communicate with the foundation on any new policies relating to the rights of Taiwanese companies, to allay concerns among these companies about increasing costs.
Last year, China’s State Council issued a directive for all local governments to withdraw their investment tax incentives to allow the central government to set up an integrated investment administration system.
Taiwanese firms were expected to be the most heavily affected by the new policy, since they had long enjoyed more local government incentives than other foreign companies in China.
The foundation subsequently sent a letter to its Chinese counterpart, the Association for Relations Across the Taiwan Straits (ARATS), demanding compensation for Taiwanese firms that had suffered losses as a result of the policy.
SEF Chairman Lin Join-sane (林中森) also reiterated the request during a meeting with ARATS President Chen Deming (陳德銘) on April 10 in Xian, China.
On April 22, it was reported that Chinese Premier Li Keqiang (李克強) had given the assurance that the preferential treatment of Taiwanese companies would be reinstated to help offset the effects of a business recession caused by a restructuring and slowdown of China’s economy.
One week later, the foundation again wrote to the ARATS, asking for a written commitment that efforts would be made to protect Taiwanese companies from the effects of the China State Council directive.
The State Council then issued a second directive, telling local governments to reinstate their preferential treatment of Taiwanese firms in line with the contracts signed with those companies.
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