The Ministry of Economic Affairs (MOEA) yesterday proposed an incentive program as part of the government’s efforts to attract homebound investment and encourage companies to engage in industrial upgrades to weather the uncertainties created by the US-China trade dispute.
The ministry has set its sights on accelerating the adoption of smart manufacturing machinery technologies and the development of the 5G network, Deputy Minister of Economic Affairs Kung Ming-hsin (龔明鑫) said during the question-and-answer portion of a meeting of the legislature’s Economics Committee.
To hasten the adoption of smart manufacturing technologies, the ministry has devised tax deductions for investors that would last three years, Kung said.
For 5G, tax deductions would be extended to four years from one year, as the first commercial 5G applications are not expected to appear until 2020, Kung said.
The tax deductions would be offered to a limited number of Taiwanese companies for a limited time, Kung said.
The ministry must submit its incentive program to the Executive Yuan for review.
Meanwhile, the MOEA and the Ministry of Finance have reached a consensus on extending the Statute for Industrial Innovation (產業創新條例) for another decade, Kung said.
The statute, set to expire at the end of next year, provides tax deductions for research and development expenses, angel investors and stock option rewards for employees, as well as pass-through taxation for partnerships.
An extension is needed so that more companies can take advantage of the statute, Kung said.
While it was designed to cultivate start-up companies and expand profit-sharing to include employees and major shareholders, the MOEA is working to add smart machinery and 5G to the statute, he said.
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