Gov`t to Boost Support for Tourism Industry

In an effort to raise the tourism industry’s competitiveness, the government will shorten the period required to get approval for the establishment of a tourist complex from the current 37 months to 10 months.

The government initially announced that it would exempt local tourist hotels from value added tax by the end of this year. However, it recently decided to lengthen the period by one year. As a result, not only industrial complexes but also tourist complexes will be totally exempt from taxes and other financial burden.

Yoo In-chon, minister of Culture, Sports and Tourism, announced these measures at a meeting designed to come up with a plan to boost the domestic tourism industry. The meeting, presided by President Lee Myung-bak, was held at Hanok Village (referring to a village consisting of Korea’s traditional houses) nestled in Namsan, yesterday.

The minister said the government would strive to boost investment and attract more tourists by providing more support for local hotels, travel agencies and tourist complexes to a level comparable with the government’s support for the manufacturing industry.

To accelerate the initiative, the government will exempt tourist complexes from development fee, registration tax, farmland preservation fee, and a fee spent on nurturing grassland.

In addition, the government will exempt land attached to tourist hotels from property tax, acquisition tax and registration tax. At the same time, it will not impose value added tax on foreign cash, meeting a long-standing demand from the tourism industry.

In an effort to draw Chinese tourists, the government will ease qualifications for Chinese who apply for multiple visas. It also plans to attract three million Chinese tourists by agreeing with China to waive visa requirements during the Beijing Olympic Games.

The government also released its goal to attract three million Japanese tourists by 2012 by concentrating promotion activities on the so-called Dankai generation of baby boomers, born after World War II, and Japanese who love Korean pop culture.

The government will closely cooperate with the private sector to lure foreign tourists. For example, it will encourage hotels, tourist agencies, airlines, railways and shopping centers to make more of an effort to draw foreign tourists, instead of carrying out tourism promotion campaigns independently.

According to the ministry, if the government eases regulations on the tourism industry and provides tax concessions, foreign tourism will increase from 6.45 million to 10 million and tourist revenue will jump from $5.8 billion to $13 billion over the same period.

On this day, President Lee said, “While running for the presidency, I thought I should nurture tourism as Korea’s future growth engine and asked myself whether Korea would succeed by supporting the tourism industry. The government should provide policies which contribute to nurturing tourism.”

Lee stressed, “Korea’s travel balance has widened as 12 million Koreans go overseas while less than 6 million foreign tourists visit Korea a year. The nation has not provided tax exemption policy for the tourist industry. However, I believe that the government should come up with effective measures to lure more foreign tourists.”

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