Tags: China | Tax | Multinational | Banks

China's Union Plans to Tax Multinational Banks

Monday, 19 Jul 2010 08:56 AM

The All China Federation of Trade Unions, China’s only legal union, plans to help fund labor activities by requiring some of the world's largest investment banks to establish union chapters, effectively levying a 2 percent tax against the banks.

"There’s a big financial incentive for them to go after the investment banks,” an executive familiar with the situation told the Financial Times. “This is the government telling them what to do.”

“It’s not a question of are they going to do it. It’s what form is it going to take and how much is it going to cost.”

ACFTU officials, focusing on bank executives rather than employees, met with representatives of Goldman Sachs, JPMorgan Chase, Morgan Stanley and UBS to effectively direct the banks to establish union chapters.

Union leaders and investment bank executives have declined to comment on the initiative, which has also affected foreign companies in Suzhou, near Shanghai, and Shenzhen, which borders Hong Kong.

Trade unions across China have been urged by China's national union chairman to protect employee rights, Xinhua reports.

ACFTU Chairman Wang Zhaoguo made the remarks during a recent five-day inspection tour to northeast China's Liaoning Province.

Wang, who is also a member of the Political Bureau of the Communist Party of China Central Committee and vice chairman of the Standing Committee of the National People's Congress, told local trade unions to implement the collective wage negotiation system "in real earnest" and to determine wage standards in a scientific way.

"This is to ensure that employees can share the rewards of business growth," he said.

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The All China Federation of Trade Unions, China s only legal union, plans to help fund labor activities by requiring some of the world's largest investment banks to establish union chapters, effectively levying a 2 percent tax against the banks. There s a big financial...
China,Tax,Multinational,Banks
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2010-56-19
Monday, 19 Jul 2010 08:56 AM
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