Tax breaks mulled for adopting flexible work arrangements

The government is considering reducing taxes for companies and employees who take advantage of flexible working arrangements such as telecommuting and staggered commutes. The idea is to create social conditions that allow working couples to raise children while continuing their careers, tackling the nation’s intensifying low birthrate problem.

According to the strategy and finance ministry and other sources on Sunday, the government is studying a detailed plan to reduce the tax burden of companies that promote employment cultures that embrace employees’ work-life balance, such as flexible work. The aim is to implement the plan as early as next year. In particular, the government is also looking at ways to lower the tax burden on workers who utilize flexible work.

The idea is to use the tax system as an incentive for companies to adopt more flexible work arrangements, such as staggered commutes and reduced working hours, and to make it easier for workers to take advantage of them. Currently, the government provides subsidies to small and medium-sized businesses and smaller conglomerates that adopt flexible work arrangements and pay a percentage of salary to workers who reduce working hours to raise children. However, there are no tax incentives for companies and employees for flexible work.

However, some critics argue that the government needs to use caution when introducing exceptional tax benefits excessively in the tax system where universality is important. The government recently announced that maternity benefits paid by companies to employees will be fully tax-free, regardless of the amount.


Do-Hyong Kim dodo@donga.com