Category: Korean Tax Law

Special Income Tax Regime for Foreign Workers under Article 18-2 of the Special Tax Treatment Control Act has been amended.  Now the 17% flat tax will, only, apply to: Employees that are not related parties to their employers.  An exception applies to companies that are authorized to receive tax incentives; and Employees for, only, a 5-year period.  Not happy news for many foreigners in Korea.  _______Sean Hayes may be contacted at: SeanHayes@ipglegal.com. Sean Hayes is co-chair of the Korea Practice

A proposed amendment to the Individual Consumption Tax Act  that was to impose a 20% consumption tax on bags with an importation price of over KRW 2million was abandoned by the tax subcommittee of the Korean National Assembly’s Strategy and Financial Committee until 2014.  The tax would have likely hit many of the super luxury brands such as Louis Vuitton, Fendi, Prada and the like.   The main, facial, purpose of the amendment was to harmonize this punitive consumption tax with

In an attempt to spark a resurgence in Foreign Direct Investment in Korea, the Korean government has proposed the development of Mini Free Economic Zones.  These zones are an attempt to attract SMEs that supply parts to Korean companies.  These Mini-FEZs are expected to charge rent far lower than market value in Korea, offer tax incentives, while offering no fee leases for companies that bring into the country technology and invest over USD 1 million in the local economy. The

This Week’s Legal News Reported by Media Missouri-Korea $1.2 billion trade agreement French minister-Korea visit US lawmakers-Korea caucus Korea’s vice justice minister resigns but denies allegations of sexual misconduct More U.S. work visas for Koreans on the cards Korea flirts again with Tobin Korea, U.S. officials discuss sanctions against Pyongyang Carter reaffirms U.S. commitment to Korea U.S. promises Korea all military resources Seoul says ready to talk to North on resuming resort tours Most Recent Posts from The Korean Law

As we all know, everyone loves to pay taxes.  Korea, over the past decade, has dramatically revised the Korean Tax Code to deal with changes in the nature of Korean business and Korean tax evaders.  Some have criticized the National Tax Services (NTS) for being reactionary.  I do not, completely, agree.  I will be writing about a few amendments over the next couple of weeks that may not be welcomed news to many of the readers, but does reflect the

Apple employs a popular tax reduction scheme called a Double Irish with a Dutch Sandwich.  The scheme is legal under Korean law.  Some media sources, in Korea, have been engaging in a relentless assault on Apple, possibly, motivated by issues that Samsung is having in courts abroad.  I worry that Korea will, again, harm its reputation abroad by engaging in some reactionary measures against Apple and other foreign competitors of Korean conglomerates.  The Lone Star fiasco has done its damage

This has not been a good year for foreign chambers of commerce in Korea – particularly for their executive employees. This spring the Korea German Chamber of Commerce & Industry conducted a forensic self audit and found its senior executive employee had been regularly using moneys for his personal use without prior approval of the president and board. That led to that employee’s immediate dismissal. The Korea European Union Chamber of Commerce, often regarded as being more of a private

The Temporary Investment Tax Credit has expired and other tax liberalization plans have been scrapped  because of a reduction in tax receipts by the government and political issues that have arisen because of the the upcoming elections in Korea.  Please see the list of article below. We suspect, if the conservative Saenari Party controls the National Assembly and the Presidency, after the upcoming elections, the previously promised tax reduction measures will be re-passed by the Korean National Assembly within the