TAIPEI (Taiwan News) — The Ministry of Foreign Affairs (MOFA) announced Thursday (Dec. 10) that after years of negotiations, Taiwan and Saudi Arabia signed the "Double Taxation Avoidance and Prevention of Tax Evasion Agreement” on Dec. 2.

Foreign Ministry spokesperson Joanne Ou (歐江安) said at a press conference Thursday that the deal, also known as the Taiwan-Saudi Tax Agreement, is the 34th tax accord Taiwan has signed with another country and the first with an Arab nation.

Ou stated that the agreement can further eliminate obstacles to bilateral investment, trade, and cultural exchanges caused by differences in income taxation. It will also help Taiwan attract investment from Saudi Arabia and ensure that investors on both sides receive reasonable tax treatment, CNA reported.

Ou said that Taiwan and Saudi Arabia have held multiple economic and trade videoconferences this year, such as the Taiwan-Saudi Arabia Enterprise Leaders’ Summit, the 2020 Saudi Arabia Online Procurement Conference, and the 2020 Taiwan Product Launch to the Middle East. This shows that Taiwan attaches great importance to enhancing economic and trade relations with the Middle Eastern country, Ou stated, adding that entering the Islamic market is one of the Taiwanese government's most important priorities in recent years.

The Ministry of Finance stated that the agreement will take effect on Jan. 1, 2021.

The ministry also pointed out that the tax agreement is based on a model international tax treaty and that a consensus was finally reached on its contents after years of consultation and promotion by the nations’ respective finance, foreign, and economic ministries.