6% → 8% revision plan for large corporations… Experts “Not enough to compete with competitors”
Pointed out that “if the level is not raised by 25%, national competitiveness in semiconductors will decrease”
While the amendment to the Restriction of Special Taxation Act (Special Taxation Act), which includes the contents of increasing the tax credit for conglomerates on semiconductor facility investment from the current 6% to 8%, is scheduled to be presented at the plenary session of the National Assembly on the 23rd, the extent of the tax credit expansion in the semiconductor industry has fallen short of expectations. gave a response.
In a situation where semiconductors are emerging as a weapon in the global supply chain and competition among countries around the world to attract semiconductor investment is intensifying, tax benefits should be drastically increased to the level of competing countries.
An industry insider said in a phone call with Yonhap News, “Everyone in the industry expected a double-digit (tax credit rate),” and “I am very worried about whether the tax credit rate will be effective as it falls far short of expectations.”
This is because the contents of the amendment bill were more backward than those of the opposition party, and the meaning has faded.
Initially, the ruling party was in a position to set the tax credit for semiconductor facility investment to 20% and 25% for mid-sized companies by 2030, but the opposition party objected to the expansion of the tax credit rate for large corporations, calling them “chaebol preferential treatment.”
The opposition party proposed tax credits of 10% and 15% for large and medium-sized companies, respectively.
As the ruling and opposition parties failed to narrow their differences, the review of the bill drifted for four months, and it was reported that the Ministry of Strategy and Finance’s position to set the tax credit for large corporations at 8% was finally accepted.
Another industry insider said, “It is fortunate that the law that has been drifting has been carried out and the uncertainty is resolved,” but said, “However, it is unfortunate that the tax credit rate is much lower than in developed countries.”
The United States enacted the Semiconductor Chip and Science Act (Semiconductor Act) to enhance the competitiveness of the semiconductor industry and applies a 25% tax credit to companies building semiconductor factories in the country.
Taiwan has also proposed a bill to raise the tax credit rate for semiconductor facility investment to 25%.
In response, semiconductor experts also responded with regret, saying that the revised bill was insufficient to compete with major semiconductor competitors such as the United States and Taiwan.
Lee Chang-han, vice president of the Korea Semiconductor Industry Association, said, “Now the whole world is waging war with semiconductors as weapons.”
Professor Park Jae-geun of the Department of Convergence Electronics at Hanyang University and president of the Korea Semiconductor Display Technology Association said, “The semiconductor industry has a characteristic of requiring a lot of initial investment, so it is necessary to reduce the investment burden through tax deductions.” If we do not raise (tax credit rate) to the level of Taiwan, the national competitiveness of semiconductors will decline,” he said.
/yunhap news