FKCCI Welcomes National Assembly Passage of K-Chips Act 'Special Taxation Act Amendment'

Amendment to the Restriction of Special Taxation Act Passed in the National Assembly Plenary Session on the 30th

The Federation of Korean Industries (FKI) welcomed the passage of the amendment to the Restriction of Special Taxation Act, one of the K-Chips Act provisions, at the National Assembly plenary session.

On the 30th, FKI stated, "The semiconductor industry is a core national competitiveness and a security asset, requiring a response at the national level beyond the corporate level," and "We welcome the passage of the bill at the National Assembly plenary session through bipartisan agreement."

The amendment to the Restriction of Special Taxation Act includes provisions to increase the tax credit rate for facility investments in national strategic technologies such as semiconductors. With the passage of this bill, the tax credit rate benefits available to large and medium-sized enterprises have increased from 8% to 15%. For small and medium-sized enterprises, it can be up to 25%.

FKI explained, "The Korean semiconductor industry is facing unprecedented challenges, including a forecasted worst deficit in the first quarter and escalating geopolitical risks due to intensified US-China hegemony competition," adding, "Through this amendment, companies will gain the ability to make timely investments even in crises, thereby expanding global leadership in the semiconductor sector in the long term and responding to supply chain restructuring."

It also stated, "This amendment introduces a temporary investment tax credit that temporarily expands the tax credit rates for new growth, core technologies, and general facility investments,"and predicted, "It will greatly help improve the investment sentiment of our companies, which has frozen due to the global economic downturn."

Finally, FKI expressed its aspiration, saying, "The business community will actively respond to the National Assembly and government's commitment to economic revitalization by expanding investments, taking the lead in overcoming the current economic crisis and enhancing growth potential."