Thursday, August 8, 2019
South Korea's Government has announced that it will provide tax relief to small and medium size businesses that have been affected by Japan's decision to remove 159 South Korea products from its export "white list."
Japan's decision comes amid rising tensions between the two countries, and South Korea is expected to announce retaliatory measures.
Meanwhile, the National Tax Service (NTS) Commissioner has held meetings with the heads of regional tax offices to discuss immediate tax administrative relief measures for SMEs financially impacted by Japan's decision, the National Tax Service announced in a statement on August 5. The NTS said seven regional tax offices and 125 local tax offices will work together to provide support.
Affected companies can apply for an extension to filing and payment deadlines, and the NTS has indicated that it will adopt a light-touch approach to penalizing those companies that fail to pay on time.
VAT refunds will be accelerated for companies, and it will seek to respond quickly to appeals against tax assessments by affected companies, within a month, rather than two as currently.
Further, the Government has said it may stall ongoing investigations into affected companies and not open new investigations.
The concessions apply only to small and medium size companies – those whose turnover is less than KRW150bn (USD123m) – that are directly or indirectly affected by the Japanese export restriction.