LH Sends Compensation Negotiation Notices... Construction Set to Begin Late Next Year
Lee Sangil, Mayor of Yongin: "Transportation Network Expansion Is Essential"
Land compensation for the "Advanced System Semiconductor National Industrial Complex" planned for the Idong and Namsa-eup areas of Cheoin-gu, Yongin, Gyeonggi Province, covering 7.77 million square meters, is set to begin in earnest.
According to Yongin City on December 22, Korea Land & Housing Corporation (LH), the project developer for the system semiconductor industrial complex, sent out compensation negotiation notices to landowners within the complex site on December 19 and has begun the process of compensating for land and fixtures.
A view of the planned site for the "Advanced System Semiconductor National Industrial Complex" in the Yongin Idong and Namsa-eup areas, where land compensation negotiation procedures have been initiated in earnest. Provided by Yongin City
The complex, to be built across 7,773,656 square meters in the Idong and Namsa-eup area, will see Samsung Electronics invest a total of 360 trillion won to construct six system semiconductor manufacturing facilities (fabs) as part of a mega-project. The complex will also house more than 80 semiconductor materials, parts, and equipment (SMPE) companies and research institutes.
Previously, after the national industrial complex plan was announced in March 2023, the Ministry of Land, Infrastructure and Transport approved the project plan in December last year. Subsequently, LH announced the compensation plan in June this year and has been carrying out procedures such as appraisal and calculation of compensation amounts.
On December 19, LH received applications for the allocation of industrial facility sites and completed contracts with companies that signed occupancy agreements. LH plans to begin construction of the industrial complex in the second half of next year.
In particular, the city has secured various tax benefits through ongoing negotiations with the government to alleviate the excessive tax burden on residents during the land compensation process for the complex.
In March, an amendment to the "Restriction of Special Taxation Act" raised the capital gains tax reduction rate by 5 percentage points for land acquired through negotiation or expropriation for public projects. The annual tax reduction limit, applied for one tax year, was increased from 100 million won to 200 million won, and the cumulative five-year limit was raised from 200 million won to 300 million won.
Accordingly, if landowners receive compensation payments split between this year and next year, the consecutive tax period standard applies, allowing capital gains tax reductions of up to 300 million won.
On November 28, the "Enforcement Decree of the Income Tax Act" was also amended, allowing land acquired through negotiation or expropriation for public projects to apply the non-taxable multiplier for residential accessory land based on the "land use zone as of the day before the project recognition announcement."
The city explained that, due to the amendment, even if the land use zone changes from green or management areas to residential, commercial, or industrial areas, the pre-change land use zone standard will apply, expanding the non-taxable scope for residential accessory land from three times the building's floor area to five to ten times. The city expects that around 100 households within the project area will benefit from the revised system.
Lee Sangil, Mayor of Yongin, stated, "The Advanced System Semiconductor National Industrial Complex must be established very quickly to maintain the semiconductor industry's technological edge, so it is encouraging that the compensation process is proceeding smoothly." He added, "We will continue to focus our administrative efforts to ensure the national industrial complex is established swiftly and operates successfully."
Mayor Lee also said, "We will do our utmost to ensure the realization of key transportation network expansion projects directly linked to the complex, such as the extension of the Gyeonggang Line, the construction of the Central Region Metropolitan Express Railway, and the Semiconductor Expressway."
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