Revised Act on Restriction on Special Cases Concerning Taxation

The Act on Restriction on Special Case Concerning Taxation provides tax exemptions, reductions, and modifications for specific categories in order to support policy objectives. The Act was revised in 2023 to increase tax credits for national strategic industries including semiconductors, batteries, hydrogen and other advanced vehicle technologies. The revision was referred to as the "K-Chips Act" by some media outlets, as a response to the US CHIPS and Science Act that focuses on boosting domestic semi-conductor investment. Specifically, rates of tax credits provided to facilitate investments in the national strategic industries were raised from 16% to 25% for small- and medium-enterprises; and from 8% to 15% for large-enterprises. 

The revision also provided an additional 10% in tax credits for investments above the three-year average amount (2020-2023). 

While the national strategic technology tax credit benefits were originally scheduled to conclude at the end of 2024, the government has since extended the program until the end of 2027.

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