© Reuters. A Taiwan flag can be seen at Liberty Square in Taipei, Taiwan, July 28, 2022. REUTERS/Ann Wang/File Photo
By Patricia Zengerle
WASHINGTON (Reuters) – Republican and Democratic members of the U.S. House of Representatives presented legislation on Wednesday that would license President Joe Biden’s administration to work out a tax contract with Taiwan, looking for to promote financial investment as Washington works to fortify the island versus an increasing China.
The legislators, consisting of House Foreign Affairs Committee Chairman Michael McCaul and leading Democrat Gregory Meeks, stated the contract, comparable to a treaty, would assist in financial investment, secure versus tax evasion and permit services in both the United States and Taiwan to prevent double tax.
“In addition to the advantages we will receive from more investment from Taiwan, this is another important step in safeguarding Taiwan and maintaining peace and stability in the Indo-Pacific,” McCaul stated in a declaration.
The costs is a buddy to a step presented in the Senate in May by legislators consisting of the chairman and ranking member of the Senate Foreign Relations Committee.
Washington and Taipei do not have official diplomatic relations, so the absence of a tax contract implies Taiwanese services and people are taxed on their earnings by both the U.S. and Taiwanese federal governments.
China views democratically governed Taiwan as its own area and has actually increased military, political and financial pressure to assert those claims.
Taiwan is a significant international provider of the semiconductor chips necessary to a large range of durable goods and military devices.
(This story has actually been refiled to fix a typo in the heading)