Tax cuts to subsidize reduced rent for small businesses
Feb. 29, 2020
Global Korean Post
By Kang Gahui and Lee Hana
Private property owners have reduced rental fees in recent weeks to assist small business owners amid the COVID-19 outbreak, and the government is stepping in with tax breaks for landlords who join this initiative.
Deputy Prime Minister and Minister of Economy and Finance Hong Nam-ki on Feb. 27 announced in a briefing at Government Complex-Seoul tax cuts to property owners who reduce rental fees for small businesses.
Noting that the rent-reduction campaign has spread from areas in Jeonju, Jeollabuk-do Province, to the Seoul markets of Moraenae and Namdaemun, he said that for this year’s first half, landlords who reduce rent for small business owners will receive a tax cut on income and corporate taxes on 50% of the deducted rent, regardless of a landlord’s income or rent amount.
For tenants of government property, rental fees will be reduced two-thirds by year’s end and such fees for government property in the provinces will be reduced from 5% of the property price to as low as 1% by year’s end.
A combined 103 public organizations that rent out property including Korail, the Korea Land and Housing Corp., and Incheon International Airport Corp. will join the initiative.
The government will revise the relevant statutes so that such changes take effect on April 1.