"5G Network Tax Credit Expanded to 2%, Base Station Registration License Tax Eased"

[Asia Economy Reporter Koo Chae-eun] The government has decided to promote corporate investment in 5G by expanding the tax credit for 5G network investments in the Seoul metropolitan area to 2% and easing the registration license tax on 5G base stations.

On the 2nd, the Ministry of Science and ICT announced that it will implement a 5G industry promotion plan containing these measures. First, the tax credit for 5G network investments will be expanded. In the Seoul metropolitan area, the tax credit rate, which was 1%, will increase to 2% this year.

The registration license tax on newly established 5G base stations will also be eased. Telecommunications companies pay the registration license tax annually to the local government where the base station is located, based on the Local Tax Act when reporting the establishment of a base station. From this year, the government plans to reduce the registration license tax burden on newly constructed 5G base stations through preliminary feasibility study applications and amendments to the Restriction of Special Local Tax Act, thereby encouraging expanded 5G investment.

The current dual system of frequency usage fees, divided into allocation fees and radio usage fees, will be integrated into a single frequency license fee. This is intended to enhance fairness and efficiency in frequency usage amid increasing demand for frequencies. Frequency license fees will be imposed on all frequency licenses; however, frequency licenses held by the state or local governments, terrestrial broadcasting, and frequency use for public welfare purposes will receive exemptions or reductions. The frequency license fee will be calculated comprehensively considering the target frequency, purpose, and bandwidth, with detailed calculation methods stipulated in the Enforcement Decree of the Radio Act.

To support testing and verification of new 5G-based devices and services, seven additional testbeds will be established, operating a total of twelve locations. The government plans to invest 15 billion KRW this year in the XR+α project, which integrates immersive content into public services, industry, and science and technology sectors to foster the 5G-based immersive content industry.

The number of 5G subscribers currently exceeds 4.5 million. The number of base stations has increased more than 2.6 times compared to the commercialization launch. Jang Seok-young, the 2nd Vice Minister of the Ministry of Science and ICT, said, "Since Korea’s 5G commercialization last year, competing countries such as China and Japan have accelerated their commercialization schedules, and global 5G competition will intensify starting this year," adding, "The government will spare no support to help our companies take the lead in global competition."

This content was produced with the assistance of AI translation services.