Taiwan said it would consider extending tax benefits to attract top-tier financial professionals looking to relocate from Hong Kong.

Taiwan’s Ministry of Finance issued the statement amid the one-year anniversary of Hong Kong’s anti-extradition bill movement as well as the approval of a national security law that many fear will curtail the autonomy and freedom of those in the Special Administrative Region.

According to Article 18 of Taiwan’s Laws and Regulations Regarding Hong Kong and Macao Affairs, the government is obligated to provide assistance to Hong Kong residents whose liberties and safety are under immediate threat. As such, the Mainland Affairs Council has already begun discussions with relevant departments, including the Ministry of the Interior and the National Immigration Agency to address issues such as living expenses, medical insurance and employment of Hong Kong citizens looking to relocate.

Earlier, President Tsai Ing-wen had proposed a rescue plan to help Hong Kongers resettle or seek shelter in Taiwan. Details are to be publicly announced soon, but sources familiar with the matter said the scheme would include arrangements for those fleeing from political persecution as well as for investors and top-tier professionals looking to relocate to the island.

Recognizing Hong Kong’s booming finance industry, the Investment Commission of the Ministry of Economic Affairs said special benefits could be granted to attract talents from this sector.

Finance Deputy Minister Lee Ching-hua said that she had so far participated in two cross-department meetings to discuss measures for attracting top-tier Hong Kong professionals to Taiwan. She said that such discussions are still in their preliminary stages.

Lee reflected that, given Hong Kong’s status as an international finance hub that enjoys a high degree of freedom, to attract high-level professionals, it would be necessary to provide innovative financial services and products. She said that the Ministry of Finance would look at plans put forward by different departments and would assess where it could lend support. Lee also said that tax benefits – although not tax cuts – would be considered, marking the first time the Ministry of Finance had made such a claim.

The Financial Supervisory Commission is also expected to propose a human-resources aspect to its New Wealth Management Scheme, which was launched late last year to make Taiwan’s financial institutions more internationally competitive and to attract more local citizens and foreigners to seek wealth-management services. To achieve this, aside from cultivating local talent, the FSC will also look to recruit overseas financial professionals.

The National Development Council, however, said that it would continue with its current policies for the recruitment and employment of foreign professionals and would not propose special measures for Hong Kong residents unless there was a particular demand for financial talents. It has held several meetings with different ministries and discussion points will be submitted to the Executive Yuan. Specific details are expected to be shared within two weeks.

Many Hong Kong residents have gone through the island’s investment immigration scheme, which requires an investment of NT$6 million (US$202,597) in a Taiwan company. A loophole in the system allows them to close their registered companies within one to two years of receiving their ID card and permanent-residency status. There are currently more than 1,000 pending cases for Hong Kong citizens applying for this visa.

Statistics from the National Immigration Agency show that there’s been a surge in the number of Hong Kong residents applying to move to Taiwan in recent years. Even during the coronavirus pandemic, 665 Hong Kongers received their residence permits in March, making a 230% increase from the previous years.

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