UK And Taiwan Sign Double Tax Agreement

by Mike Godfrey, Tax-News.com, London

11 April 2002

Responding to increasingly shrill demands from UK companies, Britain has signed a double tax agreement with Taiwan. Technically, the tax pact is between the Taiwanese representative office in London and its British counterpart in Taipei, though its description as an "agreement" rather than a mere "arrangement" was a sop to Taiwanese sensitivity over its international standing, and gives a degree of formality to the bilateral arrangement. The agreement complements existing pacts covering intellectual property rights and culture between the two trading nations.

"The signing of this agreement with Britain marks an important advance in substantive relations," said the ministry. Taiwanese officials said the agreement would help to promote two-way trade, investment, cultural exchanges and exchanges of information technology specialists.

Negotiations were complicated by the lack of diplomatic relations between Taipei and London, which maintains only unofficial ties with Taiwan out of deference to China's claim to sovereignty over the island.

Taiwan's foreign ministry said the agreement, which was only the seventeenth such deal entered into by Taiwan (the UK has over 100) would allow the island to sign similar agreements with other EU and Commonwealth governments.

As is usual, the agreement needs to be ratified by the two states' legislatures. Parliamentary approval is required for changes to the UK tax code, and in Taiwan ratification will come from the Executive Yuan.

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