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The South Korean government has taken steps to provide tax relief to organizations in South Korea using blockchain technology, he said.
Blockchain technology has been added to the list of tax credit departments for research and development in South Korea along with 15 other departments. The South Korean government has implemented this reform in support of companies that operate with blockchain technology through government incentives such as hybrid tax credit in research and development and volume-based investment credit.
R & D tax credits are tools designed by the government to promote innovation in one country. The method is followed in South Korea to grow blockchain technology in the country. The purpose of this implementation is to reward organizations that use this technology for the greatest good of the country, which is positively influencing the economy of a country.
Promoting innovation is always a positive signal for companies when it is done at a national level, as is currently done in South Korea, offering companies the opportunity to make a name for themselves using blockchain technology. This opportunity, however, is limited to a number of companies actively using blockchain technology in their processes. The idea is not only to reward organizations that use blockchain technology, but also to benefit from the result.
As announced by the Ministry of Strategy and Finance, the "proposed amendments to the decree implementing the 2018 tax law" will come into play starting in February of this year. The regulatory authority reported that blockchain technology will be one of 16 fields added to government incentives for credit research and development, together with fine dust reduction technology and wearable robots as potential growth industries in Korea of the South.
Currently the rate of tax deduction for large companies is between 0-2%, for medium-sized companies, the rate of tax reduction for research and development is around 8-15% and for small businesses the rate of tax deduction for research and development is about 25%.
After the implementation of tax breaks for organizations that use blockchain technology, the tax deduction rate for small businesses will be 30-40% and around 20-30% of the tax deduction rate will be imposed on large companies. and medium-sized companies.
A few months earlier, the South Korean government has also lined up in support of national blockchain companies to give the growing blockchain technology a rise in the country. Government officials have conducted meetings with numerous blockchain operational startups to directly engage businesses in the 10 key sectors of the fourth industrial revolution for the growth of blockchain technology in the country.
This gives companies the motivation to bring new innovations to the country, as a result of which the nation benefits as a whole and the South Korean government achieves this particular result for which they have promoted technology on several occasions and on different levels.
Looking for the support of regulators is a huge incentive in itself, giving confidence to start-ups to conduct their processes more freely and giving positive results both for the company and for the country. South Korea's efforts to promote blockchain technology businesses have sparked positive reactions in the industry that seems to be a success for both sides.
