Taiwan’s Foxconn Faces Tax Audits and Land Use Probes in China
Foxconn’s Stock Drops Amidst Tax Audits and Land Use Probes
Shares in Taiwan’s Foxconn, a major supplier of Apple’s iPhones, experienced a decline of up to 3% on Monday. This drop came in response to reports that the company is currently under investigation for tax audits and land use probes in China.
Government Investigation Targets Foxconn’s Subsidiaries
China’s state-backed the Global Times revealed that several of Foxconn’s key subsidiaries in China are the subject of tax audits. Additionally, China’s natural resources department has conducted on-site investigations into the land use of Foxconn enterprises in Henan, Hubei provinces, and other locations.
Foxconn Emphasizes Legal Compliance
In response to these allegations, Foxconn released a statement on Sunday highlighting its commitment to legal compliance as a fundamental principle of its operations. The company expressed its willingness to actively cooperate with relevant authorities to address these matters.
Production Sites and Political Implications
Foxconn primarily manufactures iPhones at its Zhengzhou plant in Henan province, employing approximately 200,000 people. While the company operates smaller production sites in India and southern China, the majority of its manufacturing takes place in Henan. The tax and land use probes come just months before Taiwan’s presidential and parliamentary elections, adding a political dimension to the situation.
Terry Gou’s Candidacy and Criticisms
Terry Gou, the billionaire founder of Foxconn, is currently running as an independent candidate in the upcoming elections. Gou, who stepped down as company chief in 2019, has accused Taiwan’s ruling Democratic Progressive Party of pursuing hostile policies that have strained relations with China. He believes that his extensive business and personal connections in both China and the United States uniquely position him to maintain peace.
The Global Times did not provide specific details about the tax or land use probes, as no official announcements have been made by Chinese government departments regarding these investigations.
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