萬國法律事務所

The major points of the draft amendment to the Statute for Industrial Innovation (SFII) submitted by the Executive Yuan to the Legislative Yuan include the following:

(1) a limited partnership may be credited for funds invested in research and development against the profit-seeking enterprise income tax owed;

(2) a limited partnership that assigns, or grants a license to use its intellectual property rights in its own R&D results to a listed, OTC, or emerging stock company as payment for shares in a company subscribed to by said limited partnership may opt to defer assessment of the income tax on its income for the then current year as calculated on the basis of the above shares in accordance with the law until the fifth year after the year it subscribes to the shares;

(3) the income of start-ups established under the Limited Partnership Act may be taxed under each partner’s income;

(4) a state-run business must set a certain percentage of its total budget for innovation or R&D. The Government Procurement Act does not apply to the procurement of research assignment or cooperation. The intellectual property and relevant result of the innovation and R&D are not limited by the National Property Act;

(5) an individual who invests cash in a high-risk start-up company established for less than 3 years may deduct as much as 50% of his/her investment from the amount of individual income.

During the preliminary review, “pass-through taxation” (point (3) above), engagement of state-run business innovation or R&D, and incorporation of the Limited Partnership Act were passed. However, the “angel investor” (point (5) above) and the tax deferral (point (2) above) amendment were set aside.