최근 세법의 동향

Abstract

Since the end of 2007, against the backdrop of the new administration focused on creating a business-friendly environment, there have been numerous legal reforms effected in various areas of the law. Particularly, the reform efforts have been geared toward revitalizing investment by businesses and increasing global competitiveness of domestic enterprises. In the area of tax law, there have been ongoing efforts to adopt more tax-cut policies and ease regulations in order to promote investment by businesses and creation of new jobs. This Article examines the corporate tax cut, introduction of the consolidated tax return system, and advance ruling system that are currently under consideration by the government as part of its plan to revitalize the economy, and suggest desirable approaches from the viewpoint of international taxation. For instance, the corporate tax reduction is recommendable in terms of attracting foreign capital as other rival counties have lowered, or are in the process of lowering, their corporate income tax rates. On the other hand, introduction of the consolidated tax return system and advance ruling system, for which specific approaches have not yet been established, would require a meticulous and comprehensive review to ensure their effectiveness, which would depend greatly on the manner of their initial administration upon their introduction. Furthermore, this Article introduces the partnership taxation, the Advance Customs Valuation Arrangement (“ACVA”), which are either currently in effect or will become effective in the near future, points out problems and loopholes, and suggests complementary measures from the standpoint of economic policies. Lastly, this Article considers significant matters relating to the execution of tax treaties in various aspects. The National Tax Service and the Ministry of Strategy and Finance seem to be focused on preventing tax avoidance schemes by domestic and foreign investors, and reducing ambiguity and uncertainty in connection with tax administration and improving its predictability. In this regard, the second protocol to the Korea-China tax treaty entered into in 2006, which clarified the anti-abuse provisions aimed at preventing tax avoidance, may be viewed as a model for a benchmark when negotiating terms of the tax treaties with other countries. The future task requiring continuous efforts by the government would include amendment of the Korea-U.S. tax treaty, which is incompatible in many aspects with the current tax environment. Since the inception of the amendment efforts in 2000, there have been numerous negotiations, but it appears no progress has been made since 2003. In the future, the Korean government should take more active steps to accomplish the amendment of the Korea-U.S. tax treaty.