Posted January. 22, 2002 09:26,
The scale of foreign investments receiving tax benefits and exemptions has largely been reduced to 50 million dollars. Also, tax conditions for tourist industries including hotels have been eased, and limitations per region has also been abolished.
The Ministry of Finance and Economy announced its plan to revise and reinforce the foreign direct investment regulation, which includes such details.
According to the revision, the amount of foreign investments eligible for tax reduction will be decreased from 100 million dollars to 50 million dollars. Also, foreign investment standard of hotel industry, including tourist and aquatic hotels, and international conference facilities, was lowered to 20 million dollars from 30 million dollars. In the case of recreational industries, the amount decreased from 50 million dollars to 30 million dollars.
The recreational industry in particular will have less investment limit, but also regional restrictions, which gave access to only `Jeju Island and tourist complex` will be lifted.
The revision also allowed tax reduction and exemption if foreigners invest more than 30 million dollars in the transportation industry.
The present regulation allows exemption on corporate tax, income tax, and taxes on dividends for the first seven years, and reduced by 50 Per Cent for the following three years of operation for foreign investment in △ high-tech business △ manufacturing-assisting service business △ large- scale investment in manufacture, hotel industry △ investment business in free trade zone and duty free zone. Also, local taxes, such as acquisition tax, registration tax, property tax, and aggregate land tax, are exempted for the first five years and cut by 50 percent for the next three years.