China taxes offshore insurance returns, hits Prudential shares

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Shares of Prudential Plc fell as much as 13% to an intraday low of 952.20 pence after Caixin reported that mainland tax authorities have started applying a 20% personal income tax on returns from Hong Kong insurance policies. Early enforcement cases were reported in Beijing and Hangzhou, and the levies specifically target dividend payouts and interest earned on prepaid premiums. Caixin said the action closes a loophole used to shelter offshore gains and follows improvements in global financial data-sharing, which have narrowed information gaps and made enforcement easier. The change threatens growth markets for insurers selling offshore policies.

Mainland starts 20% tax on Hong Kong insurance returns