"Taxi Ride-Sharing Allowed"... Hong Nam-ki Suggests Regulatory Easing

'Voluntary Ride-Sharing Service Allowed'... Aiming to Expand Investment and Jobs
Tax Benefits for New Deal Infrastructure Fund Over 5 Years

[Image source=Yonhap News]

[Asia Economy Reporter Jang Sehee] The government has decided to allow voluntary ride-sharing services in the first half of the year to support coexistence between the taxi and platform industries. The aim is to boost both investment and jobs by supporting the startup ecosystem. However, criticism has been raised that the measures are out of touch with reality, given the ongoing severity of the COVID-19 situation. Alongside this, the government plans to apply a separate tax rate of 9% on dividend income from New Deal infrastructure funds for up to 200 million KRW of investment over five years.

On the 31st, Hong Nam-ki, Deputy Prime Minister for Economy and Minister of Economy and Finance, stated at the ‘Emergency Economic Central Countermeasures Headquarters and New Deal Ministers’ Meeting’ held at the Government Seoul Office, "We will allow voluntary ride-sharing services in the first half of the year to support coexistence between the taxi and platform industries." He added, "We will promote the introduction of GPS (Global Positioning System)-based app meters, ease regulations on platform franchise businesses, and expand the scope of high-precision road maps this year to activate autonomous driving technology." The government plans to institutionalize these measures through legal amendments in the first half of the year.

Regarding concerns about the spread of COVID-19 raised by some, a government official explained, "Pilot projects are currently underway, and we will proceed considering the future extent of COVID-19 spread," adding, "The institutionalization aims to ensure the continuity of the business."

The government will expand and allow customized site supply within industrial complexes for returning companies and others, and improve rental rates and periods so that industrial complexes become a foundation for new industry growth. The government will also expand campus innovation parks linked to industry-academia-research cooperation and permit the entry of promising industries such as Changwon’s hydrogen industry, Osong’s healthcare sector, and quarantine industries in five national industrial complexes.

Additionally, as part of stimulating domestic consumption, the government is considering holding the ‘Korea Together Sale’ event, which was first held in June last year.

Deputy Prime Minister Hong also explained the operational direction of the New Deal infrastructure fund. He said, "We will apply a separate tax rate of 9% on dividend income from the New Deal infrastructure fund for investment amounts up to 200 million KRW," adding, "Considering the characteristics of the infrastructure market that requires long-term investment, the tax benefits will be maintained for five years after subscription." The government plans to pursue legal amendments in 2022 to maintain the tax benefits, which are scheduled to expire at the end of next year, and will apply them retroactively to previous investments to eliminate uncertainty regarding tax benefits.

Meanwhile, to verify whether fund investment targets qualify as New Deal infrastructure, the government has established a review system and will begin accepting applications from private fund managers starting today.

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