Taiwan and Japan have signed an agreement on avoiding double taxation.
Lee Chia-chin, head of the foreign ministry’s Association of East Asian Relations and Ohashi Mitsuo, the chairman of Japan Interchange Association signed the agreement in Tokyo Thursday. The agreement on taxation was one of three the two sides concluded after a two-day bilateral meeting on trade.
The agreement will cap taxes on stock dividends, interest, and royalties at ten percent, and eliminate taxes on interest altogether in certain cases. The agreement will also eliminate taxes on income from stock transactions.
Japanese investment in Taiwan reached US$550 million in 2014. This represents an increase of 34% over 2013, though it still falls well below the record US$1.59 billion Japan invested in Taiwan in 2006.
Taiwanese investment in Japan has also seen a sharp uptick over the past year. Taiwan invested US$680 million in Japan during 2014, four times the amount it invested in Japan during 2013.
The agreement will be sent to the legislature for approval. The finance ministry says it hopes the agreement will help Taiwan achieve its goal of joining the Trans-Pacific Partnership.