November 30, 2024

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(Yonhap)

The American Chamber of Commerce in Korea on Friday welcomed the Yoon Suk-yeol administration’s policy to expand corporate tax breaks, which are aimed at promoting active investments and job creation.

“AmCham greatly appreciates the willingness of the Korean Government to listen and promptly respond to the concerns and recommendations of AmCham and the foreign business community,” Chairman and CEO of AmCham Korea James Kim said in a statement.

“I also appreciate that the Korean government has recognized the importance of FDI (foreign direct investment) inducement and shown that they value stakeholder input from the international business community,” Kim said. “As the US is one of the largest FDI investors in Korea, I believe we could do better with these reform measures in place.”

The Ministry of Economy and Finance of Korea on Thursday unveiled a policy to revise the taxation system, which is targeted at cutting corporate and personal income taxes, including lowering of the maximum taxation rate for businesses from 25 percent to 22 percent.

AmCham had previously called for a tax reform for foreign businesses and individuals by delivering a letter to President Yoon earlier this year on behalf of the international business community in Korea.

In the letter, 34 AmCham board members addressed the need to restore the flat tax rate for foreign residents, restructure inheritance tax obligations on foreign residents, improve the flexibility of employment conditions, mitigate CEO risk, and improve the regulatory environment to ensure proactive communication in support of transforming Korea’s position as a regional headquarter in Asia.

“I am seeing more interest than ever from US companies in investing in Korea across all industries,” Kim said. “Korea can increase its economic dynamism and become attractive to foreign investors by adjusting to meet global standards. Korea’s corporate and individual tax regime could be made much more competitive compared to its peer countries in Asia.”

By Hong Yoo (yoohong@heraldcorp.com)