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  • Firms with no job cuts to receive tax benefits
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  • Only companies that kept staff numbers last year at 2007 levels are to benefit from government tax incentives.

    In an announcement yesterday, the government also said reduction of the capital gains tax on those who buy an unsold apartment unit by next February and sell it within five years of the purchase would require a documented confirmation from the local government.

    These and other new rules are in line with the revision of laws on income tax, corporate tax and comprehensive real estate tax announced by the Ministry of Strategy and Finance.

    One month ago, the Finance Ministry said it would cut corporate taxes for companies who reduce the number of their employees by up to 5 percent.

    But the ministry has toughened the qualifications for the corporate tax cuts.

    To prevent further job losses, the government said it would reduce corporate taxes on those who cut wages and share jobs instead. 50 percent of the pay cuts will be subtracted from corporate tax, the government said.

    The ministry yesterday detailed the eligibility for job-sharing tax benefits. To receive the tax benefits, one company should either have seen its sales decline more than 10 percent, or seen its output fall by more than 10 percent, or experienced average monthly stock go up by 50 percent, year-on-year, the ministry said.

    Regarding plans to cut capital gains taxes for those buying new homes until Feb. 12 next year when they sell them within five years, unsold new apartments should be less than 149 square meters in the population control zone, the government said. The tax reduction rate has been set at 60 percent.

    Those who purchase new homes in provincial areas are fully wavered from capital gains tax, if the timing of the purchase is within Feb. 12 next year and if they sell them within five years.

    By Kim Yoon-mi

    (yoonmi@heraldm.com)

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