Suseong Webtoon Poised to Benefit from Expanded Tax Credit Bill... Spotlight on Domestic Production Structure

The Democratic Party has introduced a proposed amendment to the Restriction of Special Taxation Act, which includes the establishment of a new tax credit for webtoon and publication production costs, drawing attention to the potential benefits for the webtoon industry. Suseong Webtoon, which plans and produces its works domestically, expects to achieve substantial tax savings if the amendment passes.

According to the webtoon industry on June 11, Representative Jung Sung-ho of the Democratic Party has submitted a bill that classifies webtoons and publications as video content, thereby making them eligible for income and corporate tax credits. Previously, only certain types of content such as films, dramas, and animations qualified for such tax credits.

This move appears to be part of President Lee Jaemyung's pledged policy to support the content industry. The industry is anticipating expanded investment in content production. Under the current tax law, if at least 80% of content production costs are spent domestically and certain requirements are met, a tax credit of up to 30% is available. If these criteria are extended to webtoons, tax benefits could be applied to content planned and produced within Korea.

Tommix, a subsidiary of Suseong Webtoon, operates a global paid webtoon platform. Approximately 80% of its total revenue is generated overseas. Key processes such as content planning, production, and translation are all based on domestic personnel and systems. A company representative stated, "We have an integrated structure that covers not only platform operation but also in-house content development, translation, and distribution. If the bill passes, we expect to receive substantial tax credits for domestic production costs."

Suseong Webtoon reported consolidated sales of 30.9 billion won and operating profit of 2.9 billion won in the first quarter of this year, representing increases of 96.8% and 388.4%, respectively, compared to the same period last year. The company expects that if the tax credit for webtoon production costs is added, the resulting reduction in production expenses will lead to an even greater improvement in profitability.

Suseong Webtoon has increased its stake in its subsidiary Tommix from 41% to 70.02%. The number of platform users is estimated at around 60 million worldwide. Growth in the English-speaking markets is particularly notable. The flagship title "Isekai Yonggeun Knights" recently ranked among the top paid webtoon charts in North America, while "Don't Smoke!" achieved first place in its category.