The US Senate Foreign Relations Committee on Thursday passed the Taiwan Tax Agreement Act amid growing advocacy for the US government to enter into negotiations with Taiwan on the avoidance of double taxation.
The bill was originally proposed in May by US senators Robert Menendez, Chris van Hollen, Jim Risch and Mitt Rommey.
However, the bill passed by the committee came from a revised version presented on Thursday by Menendez, chairman of the Senate Foreign Relations Committee.
Photo: Reuters
The bill would authorize the American Institute in Taiwan (AIT) and the Taipei Economic and Cultural Representative Office (TECRO) to negotiate a tax agreement in a bid to deal with double taxation issues, which Taiwanese investors in the US have sought to have changed.
The bill describes Taiwan as one of the largest trading partners of the US, as well as one of the world’s largest economies.
It says closer economic relations with Taiwan remain critical, in particular given Taiwan’s strategic importance and the increasing threat posed by China.
“A tax agreement with Taiwan would play a key role in facilitating and promoting increased bilateral investment and trade between the United States and Taiwan, fortifying the relationship between the two more generally, and encouraging other nations to increase their economic linkages to Taiwan,” it says.
It also stipulates that a future tax agreement would apply to tax residents of Taiwan and the US, but exclude enterprises headquartered in China or in a third country that does not have a comprehensive income tax treaty with Washington.
The US has signed tax agreements covering 65 jurisdictions to facilitate economic activity, boost bilateral cooperation, and benefit US businesses and individual taxpayers.
The US president would be required to provide written notification to the “appropriate congressional committees” of the commencement of negotiations between the AIT and TECRO on a tax agreement at least 15 calendar days before such commencement, the proposed legislation says.
Not later than 90 days after commencement of negotiations on the agreement, and every 180 days until the conclusion of the agreement, the US president would be required to provide a briefing to congressional committees providing an update on the status of negotiations, including a description of elements under negotiations, it says.
The committees involved would be the foreign relations, Senate finance, foreign affairs, and ways and means committees, it says.
It stipulates that a tax agreement would not take effect until Congress approves it.
Review of the bill by the Senate Foreign Relations Committee had been scheduled for June 8, but was delayed twice to Thursday partly due to a boycott by US Senator Rand Paul, who raised concerns over taxpayer privacy.
Taiwan has urged the US to enter into negotiations to sign an agreement to avoid double taxation.
When President Tsai Ing-wen (蔡英文) met with a US delegation in Taipei on July 4, she told them that Taiwan hopes to negotiate an agreement on avoiding double taxation with the US, as it would encourage bilateral investment and trade cooperation, and create more opportunities for businesses from both sides.
AIT Chair Laura Rosenberger in Washington on Thursday last week said that double taxation avoidance was an issue high on the radar of US policymakers, as well as Tsai and her colleagues.
EUROPEAN TARGETS: The planned Munich center would support TSMC’s European customers to design high-performance, energy-efficient chips, an executive said Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), the world’s largest contract chipmaker, yesterday said that it plans to launch a new research-and-development (R&D) center in Munich, Germany, next quarter to assist customers with chip design. TSMC Europe president Paul de Bot made the announcement during a technology symposium in Amsterdam on Tuesday, the chipmaker said. The new Munich center would be the firm’s first chip designing center in Europe, it said. The chipmaker has set up a major R&D center at its base of operations in Hsinchu and plans to create a new one in the US to provide services for major US customers,
The Ministry of Transportation and Communications yesterday said that it would redesign the written portion of the driver’s license exam to make it more rigorous. “We hope that the exam can assess drivers’ understanding of traffic rules, particularly those who take the driver’s license test for the first time. In the past, drivers only needed to cram a book of test questions to pass the written exam,” Minister of Transportation and Communications Chen Shih-kai (陳世凱) told a news conference at the Taoyuan Motor Vehicle Office. “In the future, they would not be able to pass the test unless they study traffic regulations
‘A SURVIVAL QUESTION’: US officials have been urging the opposition KMT and TPP not to block defense spending, especially the special defense budget, an official said The US plans to ramp up weapons sales to Taiwan to a level exceeding US President Donald Trump’s first term as part of an effort to deter China as it intensifies military pressure on the nation, two US officials said on condition of anonymity. If US arms sales do accelerate, it could ease worries about the extent of Trump’s commitment to Taiwan. It would also add new friction to the tense US-China relationship. The officials said they expect US approvals for weapons sales to Taiwan over the next four years to surpass those in Trump’s first term, with one of them saying
‘COMING MENACINGLY’: The CDC advised wearing a mask when visiting hospitals or long-term care centers, on public transportation and in crowded indoor venues Hospital visits for COVID-19 last week increased by 113 percent to 41,402, the Centers for Disease Control (CDC) said yesterday, as it encouraged people to wear a mask in three public settings to prevent infection. CDC Epidemic Intelligence Center Deputy Director Lee Chia-lin (李佳琳) said weekly hospital visits for COVID-19 have been increasing for seven consecutive weeks, and 102 severe COVID-19 cases and 19 deaths were confirmed last week, both the highest weekly numbers this year. CDC physician Lee Tsung-han (李宗翰) said the youngest person hospitalized due to the disease this year was reported last week, a one-month-old baby, who does not