Korea envisions bigger tax deductions for blockchain R&D

Blockchain tech added to new growth R&D category

The Korean government has announced plans to add blockchain technology to the category of new growth R&D (research and development) businesses to offer more tax benefits.

President Moon Jae-in chaired an expanded meeting of economic ministers Monday and finalized the government’s major economic policies for 2019. As next year’s policy directions, the government proposed enhancing economic vitality across the board; improving economic fundamentals and pushing structural reform; reinforcing economic and social inclusiveness; and boosting investment to prepare for the future.

To help revitalize the economy, the government proposed a policy cycle of “corporate foundation, growth, recouping and support for rechallenge.” What’s notable is that blockchain technology will be added to the category of new growth R&D businesses, which would envision bigger tax deductions than in the ordinary R&D category. At present, the tax deduction rate for new growth R&D is set at 30 to 40% for smaller businesses and 20 to 30% for mid-sized and large enterprises.

The government said it would use all means available, including improvements of fiscal and financial systems, to inject fresh vigor into the economy. To reinforce the justice of the market economy, the government also pledged fair law enforcement, legislation for economic democratization and win-win cooperation between large and smaller companies. /edshin@decenter.kr

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