South Korea Boosts Aid, Tax Breaks to Virus-Hit Sectors

April 23, 2020, 12:42 PM

South Korea plans to provide aid to five major industries affected by the coronavirus pandemic, Deputy Prime Minister Hong Nam-ki said in a speech to a government crisis management meeting on Thursday.

The support will go to automakers, airlines, shipping companies, oil refining companies, and shipbuilders, according to a statement by the Ministry of Economy and Finance.

  • Together, the sectors account for about a fifth of South Korea’s GDP and about 30% of exports, and employ about 600,000 people, the statement said.
  • Automakers will get tax breaks on customs duties for car parts and will be able to defer payment of tariffs and value-added tax for up to 12 months.
  • For airlines, cuts in airport charges will be extended by three months until August. Work on property tax payment deferrals is underway.
  • For refiners, tax payments can be deferred, including a three-month extension for payment of April oil taxes and a two-month extension of the deadline for paying March tariffs and VATs.

Check out Bloomberg Tax’s country-by-country roadmaps covering direct and indirect tax developments.

To contact the reporter on this story: Kazuhiko Shimizu in Bangkok at correspondents@bloomberglaw.com

To contact the editors responsible for this story: Meg Shreve at mshreve@bloombergtax.com; Kathy Larsen at klarsen@bloombergtax.com

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