The South Korean government, on August 6, announced a wide-ranging package of tax reform measures, including requirement that large companies spend a minimum amount on investments, wage increases, and dividend payments or face an additional tax of 10 percent tax on profits; a proposal to lower the withholding tax on some corporate dividends from 14 percent to 9 percent; and a measure that would increase the limit on a multinational’s tax deduction for interest payments from three times capital to two times capital.
Other measures would tax financial income at a 25 percent rate rather than the general rate; extend the special tax rate for foreign worker tax, and make this rate permanent for global corporations and R&D centers based in Korea; introduce an electronic service VAT on services, such as applications and mp3s, that are purchased at overseas online marketplaces; and ease administrative burdens on foreign companies that take advantage of tax incentives.
See:
See, also:
- “South Korea Unveils Tax Targeting Corporate Cash Hoarders,” by Kwanwoo Jun and In-Soo Nam, The Wall Street Journal
