Higher Taxes on Profits from Selling China-Linked Investments.
This law significantly increases the tax rate on profits made from selling stocks, bonds, and other financial instruments connected to the Government, Party, or companies of the People's Republic of China (including Hong Kong and Macau). The goal is to discourage citizens and businesses from holding these investments. These profits will be taxed at the highest income tax rate, rather than the lower capital gains rate.
Key points
Gains from selling specific Chinese investments will be treated as regular income, not capital gains, resulting in a much higher tax bill.
This income will be subject to the highest income tax rate applicable to the taxpayer.
Investors have a 6-month grace period after the law is enacted to sell these assets under the old rules before the new, higher rates take effect.
Taxpayers lose the ability to claim a credit for foreign taxes paid on these specific investment profits.
Expired
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