Seoul: The National Assembly passed a bill aimed at bolstering the semiconductor industry by providing larger tax incentives to chipmakers. This legislative move is designed to enhance the competitiveness of companies involved in national strategic industries, including semiconductors, secondary batteries, and future cars.
According to Yonhap News Agency, the revision to the Act on Restriction of Special Taxation, commonly known as the K-Chips Act, focuses on expanding the tax credit rates for companies investing in facilities within these strategic sectors. For conglomerates, the tax credit rate will increase from 15 percent to 20 percent, while small and medium-sized enterprises will see a rise from 25 percent to 30 percent.
In addition to the K-Chips Act, the Assembly approved a bill extending the period for research and development tax credits. This extension applies to new technologies and national strategic technologies, prolonging the applicable period by five years to 2029, and specifically for semiconductors, by seven years to 2031. Both bills will be implemented upon their promulgation.