[THE INVESTOR] The service industry will get larger tax breaks and financial support funds, under the government’s “Service Economy Development Strategy” announced on July 5.
The measures will be applied across the service sector, excluding adult entertainment businesses.
The government also plans to review more than 200 regulations and remove those deemed detrimental to the industry.
Regarding tax benefits, the service industry will be given the same benefits as the manufacturing sector, the government said.
Under current regulations, up to 30 percent of R&D and personnel training expenses of manufacturing companies are exempt from taxation. Up to 3 percent of manufacturing companies’ investments that lead to job creation are tax exempt, and SMEs in the manufacturing sector are given additional tax breaks.
According to Cha Young-hwan, the chief of Finance Ministry’s policy bureau, the support measures will be provided to all relevant businesses excluding gambling, and other adult entertainment businesses.
Research-related tax breaks will also be extended to the service industry. Until now, corporate research institutes that have between two and 10 individuals with science, technology-related degrees or industrial qualifications were eligible.
In addition, state-run banks’ funds set aside for the service industry is to be increased to 54 trillion won (US$ 46.8 billion) by 2020 from the current 39 trillion won.
By Choi He-suk (
cheesuk@heraldcorp.com)
