Vol.16 Country tax policy in response to COVID-19 and its policy implications
April 13, 2020 Vol.16
Two major tax relief packages to be implemented:
- Tax relief package approved by the National Assembly on March 17, 2020: A 2 trillion won package with the following reduction: reduction of value added tax (VAT) for small self-employed business, reduction of excise tax on car purchases, increase in the income tax deduction rate for credit card purchases or other expenses, reduction of income or corporate tax for small and medium-sized enterprises (SMEs) in “special disaster zones.”
- Tax relief package announced on April 8, 2020: A 12.4 trillion won package that includes further increase in the income tax deduction rate for credit card purchases or other expenses, tax exemption for pre-payment, expanded scope of loss carryback for SMEs, and tax payment deferral for self-employed business.