The South Korean Ministry of Finance made a new decision on taxation in the country in the morning and announced some important changes today.
Trying to combat the effects of the coronavirus, the South Korean Government has taken a new step towards this goal. The government, which aims to help the public and SMEs, has changed some tax rates for this. Finance Minister Hong Nam-ki said in a press release on the issue:
“Our government has made some changes in the tax rates in the country within the scope of combating Kovid-19. These changes were made to further support our people and businesses. ”
We can say that this tax change in South Korea is largely about investors. Individual investors in the country have been criticizing taxes in the country for some time, using both social media and other means. What these investors complain about was that the government was charging too much taxes, especially from small investors.
The South Korean Government has evaluated these complaints from individual investors and has decided to make some changes in the markets. According to local sources such as Korea Herald, the state will start to receive much less tax from small-medium investors starting next year. In addition, new incentives will be provided for small and medium-sized companies to invest.
According to the statements made by the Ministry of Finance, there will be a serious reduction in taxes on securities investments. Thanks to these tax cuts, individual investors are expected to save a total of 3.4 trillion won by 2023.
The government also announced that it will deduct VAT from some products and go to discounts covering major businesses. Small businesses in the country are expected to save 480 billion won annually thanks to these discounts. In addition, businesses considered as small-medium enterprises within the scope of the amendments introduced will be able to benefit from up to 30 percent income tax reduction for the next two years.
Will Go A Lot
The aim of the South Korean Government to make such a change was to ease individual investors and SMEs. The advantages provided to these investors and businesses will return as a disadvantage to larger investors.
According to the information provided by local sources, the ceiling rate of 42 percent ceiling income tax applied to investors earning 1 billion won and more per year will be increased to 45 percent.
Crypto Coins Will Also Affect
These new decisions made by South Korea will also affect the crypto money investors in the country. Because there are some items related to cryptocurrencies in these plans of the government, which are expected to come into force by 2021.
According to information from the Nikkei Asian Review, crypto investors in South Korea will start paying value gains tax starting next year. Investors earning 2.5 million won or more annually thanks to crypto investment will pay 20 percent tax as of October 2021.
South Korea’s Ministry of Finance just published its 2020 tax reform detail, will tax 20% capital gain on crypto asset
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These changes, prepared by the Ministry of Finance, will be presented to the National Assembly on September 3. With the approval decision from the Assembly, all these changes will have come into force.