To amend the Internal Revenue Code of 1986 to provide special rules for the taxation of certain residents of Taiwan with income from sources within the United States.
This legislation reduces US tax rates on investment income and wages earned by Taiwanese residents and companies, cutting standard withholding taxes on dividends, interest, and royalties from 30 percent down to 10 or 15 percent. To take effect, the US Treasury must first confirm that Taiwan provides identical tax reductions to American businesses and workers operating in Taiwan. The bill also authorizes the President to negotiate a comprehensive double-taxation agreement with Taiwan, which would require final approval from Congress.
What this bill touches.
Who it helps · who it burdens.
Who it helps
- Qualified residents and corporations of TaiwanReceives reduced U.S. withholding tax rates (lowered from 30 percent to 10 or 15 percent) on U.S.-sourced interest, dividends, and royalties, lower branch profits taxes, and limits on U.S. tax liability to income effectively connected with a permanent establishment (Sec. 102(a)).
- Taiwanese temporary workers, entertainers, and athletesReceives exemptions from U.S. income and withholding taxes for qualified wages paid by non-U.S. employers and up to $30,000 in U.S. earnings for entertainers and athletes (Sec. 102(a)).
- U.S. persons and businesses operating in TaiwanReceives reciprocal tax benefits in Taiwan, as the bill conditions U.S. double-tax relief on the Department of the Treasury confirming that Taiwan extends reciprocal tax benefits to U.S. persons (Sec. 102(a)(894A)(e)(1)).
Who it burdens
- U.S. withholding agents and employersMust follow new reporting, record-keeping, and verification rules established by Treasury to determine whether payees qualify for reduced withholding tax rates or exemptions (Sec. 102(a)(894A)(f)(1)(C)-(D)).
- Department of the TreasuryTasked with issuing administrative guidance and anti-abuse rules, evaluating Taiwan's reciprocity, consulting with and briefing congressional committees, publishing contemplated agreements, and submitting technical explanations to Congress (Sec. 102(a)(894A)(e)-(f), Sec. 204–206).
Who opposes it
- Entities owned or controlled by foreign countries of concernDisqualified from being treated as qualifying intermediate owners and excluded from claiming active trade or business tax relief under anti-avoidance rules (Sec. 102(a)(894A)(c)(2)(E), (c)(4)(B)(iii)).
The provisions, in plain language.
Show all 12 provisions
Lowers the U.S. withholding tax rate on interest, royalties, and dividends received by qualified residents of Taiwan from 30 percent to 10 percent (or 15 percent for certain dividends).
Exempts wages earned by Taiwanese residents working temporarily in the United States from U.S. income and withholding taxes if paid by non-U.S. employers, excluding certain government, student, or entertainer wages.
Limits U.S. income taxation of Taiwanese residents and corporations doing business in the United States to profits effectively connected with a fixed place of business (permanent establishment) in the United States.
Conditions U.S. tax relief benefits on the Department of the Treasury confirming that Taiwan provides reciprocal tax benefits to U.S. persons.
Authorizes the President to negotiate and enter into a formal bilateral tax agreement with Taiwan, which can only take effect after approval and implementation by an act of Congress and confirmation of Taiwan's approval.
Exempts up to $30,000 in U.S. earnings by Taiwanese entertainers and athletes from U.S. income and withholding taxes, provided the income is not connected to a permanent business location in the United States.
Reduces the branch profits tax rate from 30 percent to 10 percent on U.S. permanent establishments of Taiwanese corporations.
Sets qualification standards and anti-tax-avoidance rules for Taiwanese individuals, corporations, and dual residents seeking tax relief, and disqualifies entities majority-owned or controlled by foreign countries of concern.
Directs the Department of the Treasury to issue regulations and guidance enforcing eligibility, withholding, and reporting rules consistent with the 2016 U.S. Model Income Tax Convention.
Requires the executive branch to notify congressional committees at least 15 days before starting tax agreement negotiations with Taiwan, provide briefings every 180 days, and consult with committee leaders.
Requires public posting of any negotiated agreement text at least 60 days before signing, and mandates submission of the final text, a technical explanation, and required legal changes to Congress within 270 days.
Establishes that no provision of the bilateral tax agreement with Taiwan or its approval legislation has legal effect if it conflicts with the Internal Revenue Code.
Lowers the U.S. withholding tax rate on interest, royalties, and dividends received by qualified residents of Taiwan from 30 percent to 10 percent (or 15 percent for certain dividends).
Exempts wages earned by Taiwanese residents working temporarily in the United States from U.S. income and withholding taxes if paid by non-U.S. employers, excluding certain government, student, or entertainer wages.
Limits U.S. income taxation of Taiwanese residents and corporations doing business in the United States to profits effectively connected with a fixed place of business (permanent establishment) in the United States.
Conditions U.S. tax relief benefits on the Department of the Treasury confirming that Taiwan provides reciprocal tax benefits to U.S. persons.
Authorizes the President to negotiate and enter into a formal bilateral tax agreement with Taiwan, which can only take effect after approval and implementation by an act of Congress and confirmation of Taiwan's approval.
How your members of Congress line up
How members voted on H.R. 33.
Recorded roll calls on this bill, most recent first. Open one to see each member's position.
How it moved.
Show all 11 actions
- Received in the Senate and Read twice and referred to the Committee on Finance.
- Motion to reconsider laid on the table Agreed to without objection.
- On passage Passed by the Yeas and Nays: 423 - 1 (Roll no. 15). (text: CR H160-164)
- Passed/agreed to in House: On passage Passed by the Yeas and Nays: 423 - 1 (Roll no. 15). (text: CR H160-164)
- Considered as unfinished business. (consideration: CR H170)
- POSTPONED PROCEEDINGS - At the conclusion of debate on H.R. 33, the Chair put the question on passage and by voice vote, announced that the ayes had prevailed. Mr. Smith (MO) demanded the yeas and nays and the Chair postponed further proceedings until a time to be announced.
- The previous question was ordered pursuant to the rule.
- DEBATE - The House proceeded with one hour of debate on H.R. 33.
- Considered under the provisions of rule H. Res. 5. (consideration: CR H160-168)
- Referred to the Committee on Ways and Means, and in addition to the Committee on Rules, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.
- Introduced in House
- Received in the Senate and Read twice and referred to the Committee on Finance.
- Motion to reconsider laid on the table Agreed to without objection.
- On passage Passed by the Yeas and Nays: 423 - 1 (Roll no. 15). (text: CR H160-164)
- Passed/agreed to in House: On passage Passed by the Yeas and Nays: 423 - 1 (Roll no. 15). (text: CR H160-164)
- Introduced in House
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Sources & provenance
Cite this page
Civic Herald. “To amend the Internal Revenue Code of 1986 to provide special rules for the taxation of certain residents of Taiwan with income from sources within the United States. (H.R. 33, 119th Congress).” https://civicherald.app/bills/119-hr-33. Congress.gov record as of Jul 18, 2026.