South Korea has announced further tax incentives for foreign investors, in a move to make the Korean peninsula an attractive location for regional headquarters or research and development centres.
The Government announced that the KRW10m (US$9,400) corporate income tax deduction that foreign firms can currently take each local worker employed is to be raised to KRW20m.
Another incentive is a permanent income tax reduction for foreign employees working in foreign companies that have operations in South Korea. Such employees will continue to pay a 17 percent income tax rate, regardless of their salary levels.
The Government also extended from three to five years the maximum visa duration for foreign employees of a corporate headquarters in South Korea.
Meanwhile, a foreigners' investment promotion bill passed by the National Assembly allows the setting up of joint ventures with foreign businesses with a minimum South Korean ownership of 50 percent, rather than the current 100 percent.