The US-China Trade War
and its Tax Implications to Malaysia
“The trade war with China is not only affecting China and the US, it is affecting everybody … these kinds of decisions are impacting the entire world – and it should not be the right of one person to decide.” - Rodrigo Malmierca Díaz, Minister of Foreign Trade and Foreign Investment of Cuba said at the World Economic Forum’s Annual Meeting of the New Champions in Tianjin on 21 September 2018.
The US-China trade war came about when the US filed a request for consultation to the World Trade Organisation (WTO) in relation to violation of intellectual property rights by China1. On 23 March 2018, The Financial Times reported that “Donald Trump to impose 25% tariffs on USD60bn of Chinese imports – US targets strategic sectors such as robots and high-speed trains in fight over IP.” The US has iterated that tariffs are important to protect the intellectual property of its businesses. China, on the other hand, argued that the claim on violation of property rights was baseless and they refused to respond based on the WTO rules. Ever since then, both parties have not agreed on a solution. Both countries have continued engaging in trade war activities.
