Foreign Investment Support System
Reduction on Corporate Tax, Income Tax, Acquisition Tax, Registration Tax, Property Tax
Company subject for reduction
Class Condition for Tax Reduction
Industry supporting service Service with large effects of high value creation and supporting the development of other industries such as production support
Business accompanying advanced technology (Subject for reduction currently in our City) Business accompanying the following technologies that are developed at lower level or not developed in the country
- Technology with big economical and technological ripple effects on national economy and technology needed for advancing industrial structure and increasing industrial competitiveness
- Technology not passing 3 years from the first date being introduced to the country (based on the date reported by foreign investor or the date reported for signing contract to introduce technology) or technology passing 3 year mark with much greater economical effects of technologically superior than already introduced technology - Technology whose processes are mainly done in the country
New construction of plants as a company in foreign investment region - Investment amount is more than 30 Million Dollars for manufacturer - Investment amount is more than 20 Million Dollars for hotels, comprehensive leisure businesses, comprehensive theme parks, international conference facilities
- Investment amount is more than 10 Million Dollar for logistics (distribution), SOC
- Research facilities on advanced technology requires investment amount of 5 Million Dollar and more than 10 researchers with masters degree or above
- Total investment amount is more than 30 Million Dollar for more than 2 foreign investment companies
- These conditions are only applied on foreign investment region which is regions desired by foreign investors, For foreign investment region which is exclusively for foreign companies, all foreign investment companies are subject for tax reduction if the company operates business within foreign investment region
Company in a Free Economic Zone  - Logistics with more than 5 Million Dollar investment
- Manufacturing with more than 10 Million Dollar investment
When facilities are newly installed as a company in a Free Economic Zone - Manufacturer, tourism with more than 10 Million Dollar investment
- Logistics with more than 5 Million Dollar investment
Developer of a Free Economic Zone  - More than 30 Million Dollar investment or total development cost of more than 500 Million Dollar with more than 50% foreign investment
Developer in Jeju Investment Promotion Region  - More than 10 Million Dollar investment or total development cost of more than 100 Million Dollar with more than 50% foreign
Company City Development Region Company residing in Company City Development Region or Developer of Company City
Tax Reductions
Subject for reductions for those who are constructing and operating factory or business offices newly and for investment in ways of transfer the reduction range will be reduced to 50% for 3 years, 30% for 2 years
Subject for Reduction Reduction Period
(Based on the date of starting business)		 Conditions
Corporate Tax,
Income Tax		 - Until 2004.12.31, Total 10 years
(for 7 years 100%, thereafter for 3 years 50%)
- From 2005.1.1, total 7 years
(For 5 years 100%, thereafter for 2 years 50%)		 - Industry Supporting Service
- Business accompanying advanced technology  
- Company operating within Foreign Investment Zone desired by foreign investors
Total 5 years
(For 3 years 100%, thereafter for 2 years 50%)		 - Companies within Free Trade Zone
- Companies within Free Economic Zone
- Foreign investment company in Free Economic Zone and Jeju Investment Promotion Zone
- Companies within Foreign Investment Zone exclusively for foreign companies
- Companies within Company City
- Foreign investment company developing Company City
Property Tax,
Acquisition Tax, Registration Tax		 - Until 2004.12.31, Total 8 years
(For 5 years 100%, thereafter for 3 year 50%)
- From 2005.1.1, Total 7 years
(For 5 years 100%, thereafter for 2 years 50%		 - Industry Supporting Service
- Business accompanying advanced technology  
- Company operating within Foreign Investment Zone desired by foreign investors
Total 5 years
(For 3 years 100%, thereafter for 2 years 50%)		 - Companies within Free Trade Zone
- Companies within Free Economic Zone
- Foreign investment company in Free Economic Zone and Jeju Investment Promotion Region
- Companies within foreign investment region exclusively for foreign companies
- Companies within Company City
- Foreign investment company developing Company City
Note:
- Amount corresponding with foreign investment rate is reduced among reduction amount decided by the above reeducation rate.
- Property Tax, Acquisition Tax, Registration Tax can be extended within 15 years or possible to readjust reduction rate according to law by the local governments
Customs Duty.Special Consumption Tax, VAT exempted
Capital goods introduced for making payments overseas on investments received from foreign investors or for making payments domestically and capital goods introduced for investments are exempted from Customs Duty, Special Consumption Tax, VAT.
Capital goods receiving exemption should be directly used in businesses receiving reductions and capital goods completed import declaration within 3 years from the date of reporting investment.
Subject for Reduction Reduction Period Reduction Condition
Customs Duty For 3 years 100% - Industry Supporting Service - Business accompanying advanced technology
- Companies within Foreign Investment Zone
- Companies within Free Trade Zone
- Companies within Free Economic Zone
- Foreign investment company in Free Economic Zone and Jeju Investment Promotion Zone
Special Consumption Tax, VAT For 3 years 100%  - Industry Supporting Service
- Business accompanying advanced technology
- Business authorized in Foreign Investment Zone
Cash Subsidy
 - Decide the size of cash subsidy through discussion with foreign investors and review by Foreign Investment Committee when foreign investment rate is more than 30% for foreigners
- Limited on items whose final product contributes in high value creation, high effects of spreading technology or value creation effects as part, materials accompanying key advanced technology or high effects of connecting between industries for parts and materials industry
- Documents: Submit Investment Plan including total investment amount and details, size of employment, effects of spreading technology, contribution in local economy and Application for Cash Subsidy to the Minister of Commerce, Industry, Energy
Factors for Consideration Conditions Details of Cash Subsidy
- Accompanying advanced technology and technology transfer effect
- Size of creating employment
- Duplicated domestic investment
- Appropriateness of location - Effects on local and national economy
- Possibility of survival by investment 		 - More than US$ 10 Million worth of foreign investments, new construction·expansion of factories·business offices supporting industry and continuing business accompanying technology
- More than US$ 10 Million worth of foreign investments, new construction·expansion of factories·business offices for producing parts·materials accompanying state-of-the-art·core technology or highly contributing in value creation on the final products
- New construction·expansion of research facilities accompanying industry support service and high-technology industry, but it has to be over US$5 million with more than 20 permanent employees exclusively for researches with masters or above or degrees with more than 3 years of research experiences		 - Purchasing price or rental fees on land for constructing factory or research facilities
- Construction costs of factories and research facilities
- Costs for purchasing materials and research equipments for business or researching purposes in factory or research center
- Construction cost on basic facilities such as electricity·communication facility required for newly constructing factory or research facilities
- Employment subsidy and training subsidy
Clause 31 (Reduction in Rental Fees or Fees)
Full Reduction 75% Reduction 50% Reduction
A. Business accompanying high-technology, business with foreign investment amount over US$1 Million 
B. Business with foreign investment amount over US$20Million
C. Business with more than 300 employees per day in average 
D. Business exporting more than 50% of total products and whose parts and raw.sub materials are 100% supplied domestically 
E. Foreign investment company exporting 100% of total products
F. Falls under Term A or Term E, existing invested company transferring to Siheung from other regions 
G. falls under Term A or Term X, existing invested company expanding factories according to <Law on vitalization of industry integration and factory construction>		 A. Business with investment amount between US$ 10 Million and 20 Million 
B. Business employing between 200 and 300 employees per day in average
C. Business exporting more than 50% of total products and whose parts and raw·sub materials are supplied domestically between 75% and 100% 
D. Foreign investment company exporting between 75% and 100% of total products  E. Falls under Term A or Term D, existing invested company transferring to Siheung from other regions 
F. Falls under Term A or Term D, existing invested company expanding factories according to 「Law on vitalization of industry integration and factory construction 」		 A. Business with investment amount between US$ 5 Million and 10 Million  
B. Business employing between 100 and 200 employees per day in average
C. Business exporting more than 50% of total products and whose parts and raw·sub materials are supplied domestically between 50% and 75%
D. Foreign investment company exporting between 50% and 75% of total products 
E. Falls under Term A or Term D, existing invested company transferring to Siheung from other regions
F. Falls under Term A or Term D, existing invested company expanding factories according to 「Law on vitalization of industry integration and factory construction 」  
G. When falls under Clause 26 Item 1 or Item 3