On July 22, 2020, the Ministry of Economy and Finance publicly released the 2020 draft Tax Revision Bill (the ‘Draft Bill’).
Amidst the increasing risk of a global recession caused by the COVID 19 pandemic, the Draft Bill aims to: (i) promote investment and spending; (ii) enhance tax benefits to low-income earners and mid-sized and small-sized enterprises; and (iii) provide tax incentives for job creation in order to minimize the negative economic impact of COVID 19. The Draft Bill is also seeking to harmonize the Korean tax system to changes occurring in the global economy, to ease compliance burdens, and to avoid double taxation.
A summary of some key tax law proposals in the Draft Bill is provided below.