The government has imposed about NT$700 million to NT$800 million (US$21.87 million to US$25 million) in income tax on the Taipei branch of Bank of China Ltd (中國銀行), the clearing bank for yuan trading in Taiwan, as of the end of November last year, Financial Supervisory Commission (FSC) data showed yesterday.
The branch posted NT$8.4 billion pre-tax income for the first 10 months of last year, but saw accumulated pre-tax profit in the first 11 months decline to NT$4 billion.
“The result reflected the Ministry of Finance’s announcement of an explanation of the bank’s taxable income in Taiwan during the period,” Banking Bureau Deputy Director-General Jean Chiu (邱淑貞) said at a news conference.
The ministry asked the Taipei branch of the Bank of China to recognize the income tax it implemented to China, which amounted to NT$4.43 billion for the first 10 months last year, as the bank’s operating expenses, which led the bank to see a significant decline in profitability, Chiu said.
Based on the explanation, the bank has to submit further income tax to Taiwan, which would total NT$700 million to NT$800 million in the first 11 months of last year, FSC data showed.
As of the end of November last year, Taiwanese banks had earned a total of NT$6.1 billion in pre-tax income in China, with net profit standing at NT$4.9 billion, statistics showed.
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