U.S. Senator Ben Sasse (R-NE) and U.S. Senator Chris Van Hollen (D-MD) introduced a resolution to encourage the President to begin negotiating a tax agreement with Taiwan.
“Our economic partnership with Taiwan is one we should always look to strengthen,” said Senator Sasse. “Taiwan is a democratic success story, an economic success story, and our eighth largest trading partner; it’s common sense we’d negotiate a tax agreement that can benefit both U.S. and Taiwanese companies doing business in each other’s country.”
“For decades, Taiwan has been a key economic partner of the United States. Yet, right now Taiwanese and U.S. businesses are double-taxed due to the lack of a formal joint tax agreement. It’s time to address this gap in our trade policy, and our resolution urges the Biden Administration to begin negotiations to that end,” said Senator Van Hollen.
The resolution introduced by Sasse and Van Hollen would:
- Encourage the President to begin negotiations and encourage the House to work with the Senate on a congressional-executive agreement to establish an income tax agreement between the United States and Taiwan.
- Recognize the importance of Taiwan’s security and prosperity to the United States’ own security and prosperity and that eliminating double-taxation of U.S. and Taiwanese firms could boost bilateral trade and investment, potentially creating new job growth in the United States.
- It would also encourage the President to seek other ways to increase trade, technology, and investment ties between the United States and Taiwan.
- Taiwan is the United States’ largest trading partner with whom we do not currently have an income tax treaty.
- The U.S. has consistently pursued a robust unofficial partnership with Taiwan, including a strong economic relationship. Bilateral trade in goods and services totaled more than $100 billion in 2020.
- The U.S. already has multiple tax agreements in place with Taiwan, including a transportation income tax agreement and an agreement to facilitate implementation of the Foreign Account Tax Compliance Act (FATCA).