Tuesday, July 12, 2016
On July 7 at a Trade and Investment Promotion Meeting, the South Korean Ministry of Strategy and Finance reviewed the implementation of policies it has already introduced to support investment in new industries, and also unveiled a further round of measures.
With regard to implementing previous measures, it was disclosed that the Government has been working on lightening the tax burden when executing stock options, so as to attract individuals to venture capital investments. It has also expanded tax deductions for initial investments for seven years after the setting up of a business, and enhanced inheritance tax reductions for family businesses.
In addition, the tax deduction for using third party logistics providers has been expanded from three percent to five percent, to promote the logistics service industry.
New tax measures announced by the Ministry include the promotion of investments in the rental housing industry. Corporate investors investing in real estate investment trusts or real estate funds are to receive a capital gains tax deduction of up to 90 percent and a corporate tax exemption for dividend income.
The 30 percent research and development tax credit will be extended to investors in virtual reality technology, and there will be added tax incentives for venture capital investors, such as corporate tax deductions, increased tax support for reinvestments, and an expanded mergers and acquisition (M&A) tax deduction for M&As aimed at acquiring new technologies.