The Tax Subcommittee of the National Assembly's Planning and Finance Committee passed the 'K-Chips Act (Restriction of Special Taxation Act)' on the 11th, which raises the integrated investment tax credit rate for semiconductor companies by 5 percentage points.
On the 11th, members of the Tax Subcommittee of the Planning and Finance Committee, including Subcommittee Chairman Park Su-young, are conducting a meeting at the National Assembly. This meeting reviews partial amendment bills of the Restriction of Special Taxation Act, the Corporate Tax Act, and the Value-Added Tax Act. February 11, 2025 Photo by Kim Hyun-min
If the bill passes the Planning and Finance Committee and the plenary session of the National Assembly, the tax credit rate for facility investments by semiconductor companies will increase from 15% to 20% for large and medium-sized enterprises, and from 25% to 30% for small and medium-sized enterprises.
The Semiconductor Act was separately classified as a national strategic industry, and the credit rate limit was raised by adding additional credits.
In addition, the Restriction of Special Taxation Act, which extends the application period of R&D tax credits for new growth, source technologies, and national strategic technologies by 5 years until the end of 2029, and extends semiconductor R&D tax credits by 7 years until the end of 2031, also passed the subcommittee.
These laws had reached a consensus between the ruling and opposition parties during the tax law review process ahead of the year-end budget approval last year, but were not processed because the full Planning and Finance Committee meeting was not held.
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