Gwangju City and Ministry of the Interior and Safety Hear Difficulties of Companies in Opportunity Development Zone

Visit to Bitgreen National Industrial Complex Relocator 'DH Autoware'
Tax Support Including Opportunity Development Zone and Local Tax Incentives

Kwangwan Ko, Deputy Mayor of Gwangju, attended a site visit to the 'DH Autoware' company located in the Bitgreen National Industrial Complex on the afternoon of the 26th and took a commemorative photo. (From the fourth person on the left: Deputy Mayor Kwangwan Ko, Chairman Jeongwon Lee of DH Autoware, Soonki Han, Director of Local Finance and Economy at the Ministry of the Interior and Safety) Provided by Gwangju City

Gwangju City and the Ministry of the Interior and Safety visited the first company to relocate from the Seoul metropolitan area to Gwangju as part of the "Opportunity Development Zone Attraction No. 1" initiative, to listen to difficulties regarding local tax incentives and other issues.

On the afternoon of the 26th, Gwangju City announced that Han Soonki, Director General of Local Finance and Economy at the Ministry of the Interior and Safety, visited "DH Autoware," the first company in the country to relocate from the metropolitan area to the Opportunity Development Zone (Bitgreen National Industrial Complex), to hear about challenges related to the "Opportunity Development Zone and Local Tax Incentives."

This visit was organized at DH Autoware, a company recognized for excellence in local tax reduction in the Opportunity Development Zone, to gather on-site feedback regarding the effects of the zone designation and tax support for resident companies. The visit included Han Soonki, Director General of Local Finance and Economy, Seo Eunju, Director of the Local Tax Incentive System Division, other officials from the Ministry, and Ko Gwangwan, Deputy Mayor for Administrative Affairs, along with other Gwangju City officials.

The city is accelerating the creation of a future industrial ecosystem in Gwangju by supporting local tax reductions for companies located in the Bitgreen National Industrial Complex (Mobility Zone) and the Gwangju R&D Special Zone Advanced District 3 (AI Zone), both designated as Opportunity Development Zones.

The Opportunity Development Zone is a special area established under the "Special Act on Decentralization and Balanced Regional Development," aimed at promoting region-led economic growth and job creation. It provides tax benefits and regulatory relief, creating an environment conducive to economic growth through business attraction and advanced infrastructure development. The goal is balanced development using private capital by encouraging individuals and companies to relocate to the regions through locally-led zone development.

Companies investing in the Gwangju Opportunity Development Zone can receive benefits such as regulatory exemptions and tax and financial support. According to the "Restriction of Special Local Taxation Act" and the "Gwangju City Tax Reduction Ordinance," acquisition tax can be reduced by 75% to 100%.

If a company with its headquarters, main office, or factory in the Seoul metropolitan area relocates these to an Opportunity Development Zone outside the metropolitan area, acquisition tax is reduced by 50% under the Restriction of Special Local Taxation Act. In addition, Gwangju City provides an extra 50% reduction according to its ordinance, resulting in a full exemption of the acquisition tax.

For companies establishing or expanding factories in the Opportunity Development Zone, acquisition tax is reduced by 50% under the Restriction of Special Local Taxation Act, with an additional 25% reduction provided by Gwangju City ordinance.

In practice, DH Autoware, a leading mobility company in Gwangju, relocated its metropolitan area factory to Gwangju after the Bitgreen National Industrial Complex was designated as an Opportunity Development Zone and received a full exemption of acquisition tax. Although there was an opinion that the company should be subject to a 75% reduction rate as it began some operations in Gwangju before the zone designation and was considered as factory establishment or expansion, it was interpreted as a relocation from the metropolitan area to the region in line with the legislative intent of easing metropolitan concentration, thus applying the full exemption.

After the implementation of the "Restriction of Special Local Taxation Act," DH Autoware became the first company nationwide to relocate its headquarters from the metropolitan area to an Opportunity Development Zone. In December last year, it completed an automotive electronic control device parts factory in the Bitgreen National Industrial Complex, covering 24,218 square meters (7,330 pyeong). The company is expected to create 300 new jobs by producing semiconductors that integrate audio, video, and navigation into a single display.

Kim Daejeong, Head of Taxation, said, "We will actively provide tax support to companies investing in Gwangju to vitalize the local economy."

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