An agreement between Taiwan and Canada on double taxation avoidance and fiscal evasion prevention is set to take effect Jan. 1, 2017, the Ministry of Finance announced Dec. 22, adding that the pact will boost investment, expand trade and foster industrial and technological collaboration.
The accord, titled the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with Respect to Taxes on Income, was concluded Jan. 15, with the Taipei Economic and Cultural Office in Canada and the Canadian Trade Office in Taipei representing the respective sides.
Under the agreement, taxes cannot be levied by both sides on the same assets, income or financial transactions, the MOF said. The pact also includes a dispute resolution mechanism.
Statistics from the Bureau of Foreign Trade under the Ministry of Economic Affairs reveal that in 2015, Canada was Taiwan’s 23rd largest trading partner, while Taiwan is Canada’s 12th biggest trading partner and fifth largest in Asia. From January to October this year, trade between the two sides exceeded US$2.7 billion.
By the beginning of November this year, Canada had invested an overall total of US$578 million in Taiwan, mainly in the electronics, finance and insurance sectors. Meanwhile, Taiwan has made accumulated investments of US$458 million in Canada, with a focus on pharmaceuticals, finance and insurance, according to the MOF.
The pact is Taiwan’s first comprehensive taxation agreement with a North American nation, the MOF said, adding that the ministry will continue efforts to establish mutually beneficial taxation agreements with high-trade countries including New Southbound Policy target nations, namely Association of Southeast Asian Nations member states, South Asian countries, Australia and New Zealand. These efforts will enhance Taiwan’s competitiveness and create a friendlier environment for international investments, the ministry added. (KWS-E)
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