Statute for Upgrading Industries amended; several tax benefits applicable next month

The Office of the President on this 30^th promulgated the amendment to the Statute for Upgrading Industries, which has taken effect February 1, 2002.  Multiple tax benefits, which have attracted many people's attention, include: 1. The deductible rate for investment on R&D and personnel training is raised from the original 5-25% to 35%; 2. A foreign profit-seeking enterprise shall be exempted from tax on income derived from setting a logistics distribution center in Taiwan for warehousing, basic processing, and delivering cargo to the domestic customers; 3. A company shall be exempted from the business tax and transaction tax on corporate bonds incurred from a merger of companies, and the deduction of losses shall be applicable to the resulting company.  If there is land transfer from the merged company to the resulting company, the land-value increment tax shall be charged and payable to the latter; 4. Affiliate companies are exempted from business income tax on income derived from the management service for headquarters, R&D, royalties, investments, surplus after tax deduction.