Hong Kong, Beijing Sign Tax Deal, Pact Will Cut Rates On Investment Income From Chinese Companies – Andrew Batson

From the Wall Street Journal:

Hong Kong and Chinese officials have signed a new taxation agreement that is intended to make Hong Kong more attractive as an offshore base for investments in mainland China.

The pact, signed Monday, will reduce the rates of tax paid by Hong Kong-based firms and individuals on investment income — including dividends, interest, royalties and capital gains — they earn from companies in mainland China.

The new arrangement is an extension of the existing system for avoiding double taxation, in place since 1998, which covers taxes on profits and wages.[Full Text and Subscribers Only]