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New incentives lure foreign IT workers
PREFERENTIAL MEASURES: The government hopes to make Taiwan a more attractive option for foreign professionals to counteract a projected shortage of high-tech talent
By Shih Hsiu-chuan
Thursday, Jun 28, 2007, Page 1
The Cabinet yesterday passed a package of measures, including tax and non-tax incentives, aimed at encouraging foreign high-tech professionals to work in the country.
"It is imperative that we implement measures encouraging foreigners to come to Taiwan in light of the estimated shortage of 34,000 people in six high-tech industries by 2009," Premier Chang Chun-hsiung (???) told the media after the Cabinet's weekly meeting yesterday.
Chang said personnel shortages were expected in the semiconductor, display technology, digital content, communications, biotechnology and information service industries.
"Training our own high-tech experts would be too slow to resolve this critical situation," he said. "I have asked the government departments to carry out the measures in earnest."
The plan, drafted by the Council of Economic Planning and Development (CEPD), provides tax incentives to businesses hiring foreign professionals, as well as foreign professionals who stay in the country for at least 183 days per tax year.
One of the tax incentives stipulates that the extra expenditures incurred by businesses employing foreign professionals would be regarded as part of the businesses' operating expenses, rather than being considered the employees' responsibility as they are under current regulation.
The extra expenditures include the cost of bringing foreign professionals and their family members to Taiwan, utility fees, telephone charges, house-cleaning fees, rental expenses and grants for their children.
The revision would enable foreign professionals to reduce the taxable portion of their income, while the extra expenditures would be deductible from corporate income.
"We estimate that the tax incentive would reduce annual tax revenue by NT$1 billion (US$30.4 million), but we believe the economic benefits foreign professionals can bring to the nation would be more than the tax loss," CEPD Vice Chairman Thomas Yeh (???) said at a press conference after the Cabinet meeting.
He said that about 1,000 foreign senior executives currently living in Taiwan would be eligible for the preferential measures, accounting for one-third of foreign high-tech professionals in the country.
Yeh said that the government was still finalizing the exact definition of what constituted "foreign high-tech professionals."
"We hope to put the plan into effect in one to two months," he said.
The tax incentive would take effect without the need to be put into legislation.
Some of the other non-tax incentive measures that were passed yesterday are designed to create a hospitable living environment for foreign professionals.
The government plans to relax several restrictions on foreign professionals' Chinese spouses, including granting their spouses multiple entry visas that will be valid as long as the foreign professionals are employed in the country.
The changes would take effect as soon as the legislature amends the relevant regulations.
Yeh said that the government would also revoke an existing regulation that Chinese spouses' identification documents must remain in official custody during their stay in the country.
The limited period in which foreign professionals can apply to renew their work permits would be extended from two to four months. They would also be allowed to remain in the country for a maximum of 14 days after their work permit expires, instead of the current seven days.