Corporate taxes

摘要

South Korea levies both national and local taxes. In addition to a corporate income tax and tax on accumulated earnings, national taxes include minimum tax, value-added tax (VAT), branch tax where applicable, capital gains tax, taxes on security transactions, customs duties, an education levy and a surtax earmarked for development of agriculture and fisheries. Local taxes may also be levied, such as local income surtax, acquisition and registration taxes and a tax on local inhabitants. Income tax, corporate tax and VAT account for most of South Korea's internal tax revenue. The tax system is cumbersome, complicated by the so-called tax-on-tax schemes and various surtaxes. Taxation of foreign-invested enterprises in South Korea is a complex issue governed by several laws and tax treaties. The most relevant laws include the following: the Corporate Tax Act (originally promulgated in 1949, with numerous amendments since then), the Law for the Co-ordination of International Tax Affairs of 1996, the Foreign Investment Promotion Act of 1998 and the Special Tax Treatment Control Law of 1999. The Corporate Tax Act distinguishes between domestic and foreign corporations for tax purposes. However, many of its provisions governing the taxation of domestic corporations apply to foreign corporations as well.