The South Korean government is using its tax reforms to help the economy overcome the damage caused by the COVID-19 pandemic.
"Above all, we've tried to make groundbreaking changes to the tax code so that citizens and companies can recover from the impact of the outbreak".
These changes include corporate tax relief based on investments.
More types of investments will be eligible for tax exemptions and tax incentives will increase in line with investments. Tax relief will be higher for investments included in South Korea's digital and green new deal projects and new growth industries.
As part of its effort to boost consumption, tax relief for credit card spending has been increased. The amount of spending that is eligible for tax relief will be raised by about 250 U.S. dollars for all income brackets until 2020.
On top of that, the revision also aims to extend payroll tax incentives for small to medium-sized companies. For every temporary worker who is switched to a permanent position, the company will get up to 8-thousand 3-hundred dollars of tax deductions.
The government's tax changes also aim to revitalize the stock market and support retail investors who have propped up the stock market during the outbreak. Stock transaction tax will be lowered gradually from the current point-25 percent to point-15 percent by 2023.
This will help ease the burden on investors as they have to pay the transaction tax even if they make a loss on their stock investments.
And from 2023, the capital gains tax on stocks will only apply to those whose income from investment is more than 41-thousand dollars a year. This has been revised upwards from the previously planned 16-thousand dollars to minimize the damage of the tax revisions on the stock market.
Eum Ji-young Arirang News.