Washington DC [US], January 18 : The US House of Representatives passed a bill on January 15 that aims to reduce tax payments, prevent double taxations and provide tax exemptions for Taiwanese businesses, residents and employees in the US, Central News Agency Taiwan reported.
As per Focus Taiwan, titled The United States-Taiwan Expedited Double-Tax Relief Act, the act was passed in the House by 423-1 vote. It will now be sent to the US Senate for a vote, and if approved, will be sent to the American president to be signed into law.
The main aim of the bill is to prevent double taxation between the US and Taiwan. It seeks to amend the current US tax laws to provide tax exemptions for eligible Taiwanese residents in the US and to lower the withholding tax rates on income from specific sources in the US, such as dividends and interest, according to a report by Focus Taiwan.
In a significant development, the Bill would seek to enact the United States-Taiwan Tax Agreement Authorization Act, which would authorize the U.S. president "to negotiate and enter into a tax agreement relative to Taiwan", Focus Taiwan said.
Representative Judy Chu said that the current laws require Americans doing business in Taiwan to pay income tax in both places on the same earnings, and vice versa, which has "hurt businesses of all sizes."
She noted that among the US ' top 10 trading partners, "only Taiwan lacks a double tax agreement."
She also referred to a survey conducted by the American Institute in Taiwan, which showed that for 79 per cent of Taiwan companies, the double taxation of income requirement was "a considerable factor" that prevented them from "investing more in the US".
Referring to Representative Jason Smith, who chairs the Ways and Means Committee in the House, Focus Taiwan noted that he said before the vote that while Taiwan is America's eighth largest trading partner, it has remained "conspicuously absent" from the list of 66 countries with which that the US has income tax treaties.
The new bill "promotes economic efficiency and integration, strengthens our strategic partnership with Taiwan, and reinforces the long-term economic stability American businesses and our trusted allies need to invest for the future and combat the influence of bad actors," Smith said.
Disclaimer: This post has been auto-published from an agency feed without any modifications to the text and has not been reviewed by an editor