'2020 Tax Reform Bill' Approved at Cabinet Meeting... To Be Submitted to National Assembly Early Next Month

[Asia Economy Reporter Kwangho Lee] The government announced that it finalized the '2020 Tax Law Amendment Government Proposal' at the Cabinet meeting held on the 25th, according to the Ministry of Strategy and Finance.

After announcing the 2020 Tax Law Amendment on the 22nd of last month, the government went through inter-ministerial consultations and legislative notice for 16 bills including the Framework Act on National Taxes, Income Tax Act, Corporate Tax Act, Inheritance and Gift Tax Act, Comprehensive Real Estate Tax Act, Value-Added Tax Act, and Securities Transaction Tax Act, and approved the government proposal as is at the Cabinet meeting on this day.

This year's tax law amendment includes imposing taxes on stock investment gains exceeding 50 million KRW annually, while reducing the securities transaction tax by 0.02 percentage points next year and by 0.08 percentage points in 2023, ultimately lowering it to 0.15%.

For ultra-high-income earners, taxes will be increased. A new tax base bracket exceeding 1 billion KRW is established, and the income tax rate for this bracket is raised from the existing 42% to 45%.

The real estate tax reforms, including the Comprehensive Real Estate Tax and Capital Gains Tax, announced through the December 16, last year, June 17, and July 10 measures this year, are also included as is in the tax law amendment.

Investment tax credits for companies will also be expanded. Currently non-taxable virtual asset transaction income will be separated and taxed as other income at a 20% income tax rate, and the individual consumption tax rate on liquid-type electronic cigarettes will be raised to a level similar to that of combustible cigarettes.

The government plans to submit the 16 bills approved on this day to the regular National Assembly session by the 3rd of next month.

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