First Ever Tax 업무협약 Signed for Three Major Public Pensions and Funds

The three major public pension institutions (National Pension Service, Government Employees Pension Service, and Private School Teachers’ Pension Service) and Korea Investment Corporation will establish a cooperative system to enhance profitability through discovering tax-saving opportunities.

On the afternoon of the 15th, the National Pension Service signed a business agreement related to ‘exchange and promotion of tax-related work’ with the Government Employees Pension Service, Private School Teachers’ Pension Service, and Korea Investment Corporation (in alphabetical order) at the National Pension Service Seoul Southern Regional Office.

This is the first time a multilateral business agreement has been made in the tax field among major public pension funds.

This agreement was realized at the proposal of the National Pension Service to strengthen tax expertise related to fund investments and to establish a mutual cooperation system.

The National Pension Service initiated this business agreement because overseas tax payments have increased due to the expansion of overseas investments, making tax-saving efforts important to improve fund profitability.

Countries around the world provide tax benefits to attract investments from overseas public funds while also strengthening regulations to prevent tax evasion, making strategic joint responses necessary.

Through this agreement, the four institutions promised mutual exchange and cooperation, including ▲ sharing domestic and international tax trends and issues ▲ discussing and jointly responding to common tax issues ▲ sharing institution-specific tax matters and tax-saving cases.

The National Pension Service has so far received refunds of more than 80 billion KRW in taxes paid by being recognized for tax-saving status in countries such as the United States, the United Kingdom, the Netherlands, Denmark, and Spain, and saves more than 40 billion KRW annually.

In particular, last year, it actively pursued tax-saving strategies related to overseas investments, earning recognition for contributing to fund profits by acquiring qualified overseas pension fund status in the United States and receiving a commendation from the Board of Audit and Inspection.

Seowon Joo, Head of Fund Management at the National Pension Service, said, “As much as generating profits through overseas investments of the fund, tax-saving efforts are also important. This year, we reorganized the organization by establishing a dedicated tax department and reinforcing personnel,” adding, “Through this agreement, we expect to contribute to increasing national wealth by sharing tax-saving opportunities among domestic public pension funds.”