Apple supplier in trouble – level 3

25-10-2023 07:00

Foxconn, a major supplier of Apple’s iPhones, is under investigation for tax-related issues in China.

This information was reported by China’s state-backed Global Times, raising concerns that it may be politically motivated, possibly tied to Taiwan’s upcoming elections. Two unnamed sources close to Foxconn confirmed the tax probe but suggested that other companies had also been audited by Chinese authorities recently, and Foxconn’s case was made public for political reasons. These audits come just before Taiwan’s presidential election and amid Foxconn’s efforts to expand production outside China. Taiwan’s government accuses Beijing of trying to influence its elections, either through military or economic pressure.

Foxconn’s founder, Terry Gou, who stepped down from his role at the company in 2019, is running for president as an independent candidate. His candidacy might affect the opposition’s vote, potentially benefiting the current Vice President, Lai Ching-te, who leads in the polls.

Difficult words: probe (an investigation into a particular matter), audit (to conduct an official financial inspection of a company or its accounts), poll (the process of voting in an election).

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What incentives or motive do the Chinese authorities have to make Foxconn’s tax probe publicly known before Taiwan's presidential elections?


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