Revision of the 'Enforcement Decree of the Local Tax Act'
Driven by Jeonnam Province's Proposal
Expected to Boost Corporate Investment in Enterprise City Industrial Land
Jeonnam Province announced on May 21 that the revision of the 'Enforcement Decree of the Local Tax Act,' which significantly reduces comprehensive real estate tax and property tax for companies investing in enterprise city industrial land, is expected to boost investment attraction.
This resulted from Jeonnam Province, along with Yeongam and Haenam Counties, continuously proposing the need to revise the 'Enforcement Decree of the Local Tax Act' to the National Assembly, the Ministry of the Interior and Safety, the Ministry of Culture, Sports and Tourism, and the Local Tax Research Institute, in order to implement separate taxation of property tax for industrial land.
The Ministry of the Interior and Safety selected the separate taxation of property tax as a feasibility study project last year. After more than a year of research and on-site inspections, the proposal passed the Local Finance Management Committee's review in March this year, and was approved at the Cabinet meeting on May 20.
The revised decree introduces a new provision applying separate property tax for five years, until 2029, to enterprise city industrial land located in areas with declining populations. This will apply to Solar City Enterprise City (Yeongam and Haenam) and Taean Enterprise City.
The revision will take effect on June 1, the property tax assessment date for enterprise city industrial land. For property tax, the rate will change from the previous comprehensive progressive rate of 0.2-0.5% to a flat rate of 0.2%. The reduction in comprehensive real estate tax will also ease the tax burden on resident companies and is expected to further promote corporate investment and attract new businesses.
This revision is expected to create synergy for the development of enterprise cities, in connection with the planned 'Artificial Intelligence (AI) Supercluster Hub' in Solar City and the establishment of RE100 industrial land based on eco-friendly renewable energy.
Seo Sooncheol, Director of Enterprise City at Jeonnam Province, said, "Solar City Enterprise City has faced difficulties attracting companies from the Seoul metropolitan area, but with this revision, an institutional foundation for reducing comprehensive real estate and property taxes has been established. We expect this will greatly facilitate corporate investment attraction and accelerate the early development of the enterprise city."
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