CONTINUEThis site uses cookies. By continuing to browse this site you are agreeing to our use of cookies. Find out more.
  1. Front Page
  2. News By Topic
  3. New Tax Breaks To Boost South Korean Economy

New Tax Breaks To Boost South Korean Economy

by Mary Swire,, Hong Kong

07 February 2017

In its work report for 2017, the South Korean Ministry of Strategy and Finance has indicated that it will focus on boosting South Korea's currently-weak economic growth, in part through fiscal reforms.

For example, the Ministry said that it would introduce an "investment-friendly as well as employment-friendly" tax system, and expand tax support for working- and middle-income classes. It has committed to redesigning tax incentives "for fairer taxation and improved tax transparency," and reducing compliance costs by upgrading tax regulations and simplifying the tax code.

Within its efforts to promote domestic consumption, tax breaks will be provided for new car purchases if they replace old diesel vehicles. There will be a temporary 70 percent individual consumption tax cut and a 50 percent registration tax reduction, until June 2017.

In addition, South Korea will work towards the completion, as fast as possible, of the bilateral and multilateral trade treaty negotiations that are currently underway, including towards the Regional Comprehensive Economic Partnership and the Trade in Services Agreement.

With regard to South Korea's current fiscal position, the Ministry noted that its tax revenue (excluding social security contributions) has risen from 17.9 percent of gross domestic product (GDP) in 2013 to 18.9 percent in 2016. The Government is to accelerate parliamentary passage of the Fiscal Soundness Act that will limit the level of government debt below 45 percent of GDP and its fiscal deficit to below three percent of GDP.

TAGS: compliance | Finance | tax | value added tax (VAT) | sales tax | tax incentives | fiscal policy | gross domestic product (GDP) | trade treaty | agreements | Korea, South | tax breaks | revenue statistics | regulation | trade

To see today's news, click here.


Tax-News Reviews

Cyprus Review

A review and forecast of Cyprus's international business, legal and investment climate.

Visit Cyprus Review »

Malta Review

A review and forecast of Malta's international business, legal and investment climate.

Visit Malta Review »

Jersey Review

A review and forecast of Jersey's international business, legal and investment climate.

Visit Jersey Review »

Budget Review

A review of the latest budget news and government financial statements from around the world.

Visit Budget Review »

Stay Updated

Please enter your email address to join the mailing list. View previous newsletters.

By subscribing to our newsletter service, you agree to our Terms and Conditions and Privacy Policy.

To manage your mailing list preferences, please click here »