Several months after the business’s millionaire founder said he would run in Taiwan’s presidential elections, the tax authorities in China began various investigations into the company Foxconn that develops the iPhone.
According to sources in the local media, Foxconn is expected to undergo tax audits of its operations in China, as well as probes into land use in two provinces located within China.
It is widely believed that political considerations were a driving force behind the investigations, which have been verified by the manufacturer based in Taiwan but have not been formally acknowledged by any of China’s government departments.
Terry Gou, the founder of Foxconn, made the announcement in August that he would participate in the presidential election in Taiwan in 2024 as an independent candidate. A few days after announcing his intention to run for election, well-known and outspoken businessman Gou resigned from the board of directors of the company.
Foxconn, which is also known as Hon Hai Technology Group and is one of the largest employers in the world, stated that it will comply with the investigations. Foxconn is Apple’s top supplier of iPhones and is also known as Hon Hai Technology Group. “A fundamental principle of Hon Hai Technology Group is to operate in full compliance with the laws of each and every country in which we do business.” On the linked tasks and operations, we will work closely with the relevant units and actively cooperate with them.
On Monday, shares of Foxconn fell by more than 2 percent as a result of the announcement. During the pre-market hours, shares of Apple experienced a decline of almost one percent. The American technology firm is the most successful business in the history of the globe, and its iPhone is the most significant product it has ever produced.
The tax investigations against Foxconn have begun at a time when tensions are running high between Beijing and Washington following a series of measures taken by each nation to restrict the technology industries of the other. On the basis of national security concerns, the administration of Joe Biden disclosed last week its intention to limit the amount of advanced artificial intelligence chips manufactured by Nvidia and other companies that are sent to China.
Some of the largest corporations in China’s troubled real estate market are on the verge of defaulting on their financial obligations as the country’s overall economic growth continues to decelerate. China is also battling with its own economic growth slowdown. The CSI 300 index for the country experienced a decrease of more than 1% on Monday, bringing it down to 3,450 points and marking its lowest level since before the Covid epidemic in February 2019.
There is also ongoing conflict over Taiwan’s independence, as China has sworn to incorporate Taiwan into the Chinese state as part of what it refers to as “reunification” ambitions. This creates continual tension. This is in spite of widespread opposition from Taiwan’s populace as well as from the country’s most prominent political groups.
China severed all communications with Taiwan in 2016, and in recent years it has become increasingly aggressive, deploying a growing number of warplanes and ships into Taiwan’s air defense zone.
At the beginning of his campaign for the presidency, Gou made the statement that he would “bring 50 years of peace to the Taiwan strait and build the deepest foundation for the mutual trust across the strait.”
He also drew parallels between the situation in Ukraine and Russia’s invasion of Ukraine in early 2022. In addition, he placed the responsibility on President Tsai Ing-wen’s party, which is currently in power, for the escalation of hostilities.
“During the roughly seven years that the Democratic Progressive party has been in power, they have brought Taiwan dangerously close to the brink of war on the international stage. He has stated in the past that their policies are riddled with errors both domestically and internationally.
“Taiwan must not become Ukraine, and I will not let Taiwan become the next Ukraine,” Gou continued.