From September, Corporate Cars to Have Light Green License Plates... Preventing 'Nominal Corporate Cars'

It is reported that rental cars will also be included
Expectations to prevent private use of company vehicles

It has been reported that a system requiring 'light green' exclusive license plates for corporate vehicles will be implemented starting this September. The vehicles subject to this requirement will include those purchased or leased by corporations, official vehicles, and rental cars.

According to the 'Chosun Ilbo' on the 5th, the Ministry of Land, Infrastructure and Transport plans to announce an administrative notice regarding the exclusive license plate system for corporate vehicles within this month. This system is expected to be applied from September after regulatory review. However, it will not be retroactively applied to corporate vehicles already registered.

Example of a corporate vehicle exclusive license plate. [Image source=Ministry of Land, Infrastructure and Transport]

This system was devised to prevent tax benefits obtained by purchasing or leasing high-priced vehicles under a corporate name and then privately using them by the company owner or their family. It is also expected to block vehicles that are essentially 'nominal corporate cars.'

The exclusive license plate system for corporate vehicles was originally scheduled to be introduced this month, but the final adjustments regarding the vehicles to which the plates would be attached caused a delay of about two months.

In fact, materials disclosed by the Ministry of Land, Infrastructure and Transport at the 'Public Hearing on the Introduction Plan for Corporate Passenger Car Exclusive License Plates' held at the end of January showed that long-term rental cars in the private sector appeared to be excluded from the license plate attachment target.

Regarding this, the Ministry explained that long-term rental cars are excluded because they are already distinguishable from regular vehicles by their unique identification marks. However, some have pointed out that the purpose of the system could be undermined if companies bypass purchasing or leasing corporate vehicles directly and instead use private long-term rental cars.

Meanwhile, it is very common in Korea for foreign luxury cars to be registered as corporate vehicles. From January to May, the number of cases where corporations purchased ultra-luxury imported cars costing over 150 million won increased by 19% year-on-year to 9,118 units. During the same period, total imported car sales in Korea decreased by 4%.

The representative overseas supercar brand Lamborghini sold 143 units domestically from January to May, of which a remarkable 90% were corporate purchases. Among 292 units of the British luxury car Bentley sold, 75% were corporate sales.

According to the passenger car registration status received by Yang Kyung-sook, a member of the National Assembly’s Planning and Finance Committee from the Ministry of Land, Infrastructure and Transport, as of the end of April this year, out of 5,006 cumulative registrations of passenger cars with acquisition prices between 300 million and 500 million won, more than half?3,793 units?were corporate vehicles.

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