Tax Credits to Be Provided before Investment Proof
An amendment to the Enforcement Decree of the Restriction of Special Taxation Act was passed on Feb. 21 so that companies investing in key industries can get tax credits before investment proof. The official announcement of the new decree is scheduled for late this month and its first effective date is Jan. 1 this year.
The corporate tax credits for capital expenditures in core technologies and industries became effective in December 2021. Specifically, the credits are available in the three fields of semiconductor, rechargeable battery and vaccine. The deduction rate applied to large corporations is 6 percent and those of medium-sized and smaller companies are 8 percent and 16 percent, respectively.
The new decree covers the three fields, display and 13 others including carbon neutrality, future car, intelligence information and robot. The government is planning to raise the deduction rates to 15, 15 and 25 percent, which is pending in the National Assembly with opposition parties opposed.