Law Viewer

Back Home

RESTRICTION OF SPECIAL LOCAL TAXATION ACT

Act No. 10220, Mar. 31, 2010

Amended by Act No. 10252, Apr. 12, 2010

Act No. 10333, May 31, 2010

Act No. 10356, jun. 8, 2010

Act No. 10361, jun. 8, 2010

Act No. 10369, jun. 10, 2010

Act No. 10417, Dec. 27, 2010

Act No. 10470, Mar. 29, 2011

Act No. 10628, May 18, 2011

Act No. 11029, May 18, 2011

Act No. 10654, May 19, 2011

Act No. 10789, jun. 7, 2011

Act No. 10890, Jul. 21, 2011

Act No. 10932, Jul. 25, 2011

Act No. 11042, Sep. 15, 2011

Act No. 11093, Nov. 22, 2011

Act No. 11138, Dec. 31, 2011

Act No. 11141, Dec. 31, 2011

Act No. 11241, Jan. 26, 2012

Act No. 11397, Mar. 21, 2012

Act No. 11487, Oct. 2, 2012

Act No. 11618, Jan. 1, 2013

Act No. 11690, Mar. 23, 2013

Act No. 11716, Mar. 23, 2013

Act No. 11762, May 10, 2013

Act No. 11999, Aug. 6, 2013

Act No. 12175, Jan. 1, 2014

Act No. 12251, Jan. 14, 2014

Act No. 12329, Jan. 21, 2014

Act No. 12506, Mar. 24, 2014

Act No. 12686, May 28, 2014

Act No. 12844, Nov. 19, 2014

Act No. 12955, Dec. 31, 2014

Act No. 12989, Jan. 6, 2015

Act No. 13248, Mar. 27, 2015

Act No. 13288, May 18, 2015

Act No. 13383, jun. 22, 2015

Act No. 13426, Jul. 24, 2015

Act No. 13435, Jul. 24, 2015

Act No. 13442, Jul. 24, 2015

Act No. 13448, Jul. 24, 2015

Act No. 13498, Aug. 28, 2015

Act No. 13499, Aug. 28, 2015

Act No. 13605, Dec. 22, 2015

Act No. 13609, Dec. 22, 2015

Act No. 13613, Dec. 22, 2015

Act No. 13637, Dec. 29, 2015

Act No. 13729, Jan. 6, 2016

Act No. 13805, Jan. 19, 2016

Act No. 13854, Jan. 27, 2016

Act No. 14095, Mar. 22, 2016

Act No. 14111, Mar. 29, 2016

Act No. 14115, Mar. 29, 2016

Act No. 14122, Mar. 29, 2016

Act No. 14198, May 29, 2016

Act No. 14226, May 29, 2016

Act No. 14477, Dec. 27, 2016

Act No. 14474, Dec. 27, 2016

Act No. 14476, Dec. 27, 2016

Act No. 14481, Dec. 27, 2016

Act No. 14567, Feb. 8, 2017

Act No. 14569, Feb. 8, 2017

Act No. 14839, Jul. 26, 2017

Act No. 14939, Oct. 24, 2017

Act No. 15012, Oct. 31, 2017

Act No. 15309, Dec. 26, 2017

Act No. 15295, Dec. 26, 2017

CHAPTER I GENERAL PROVISIONS
 Article 1 (Purpose)
The purpose of this Act is to contribute to operating local finance soundly and to realizing fair taxation by efficiently implementing local tax policy, by prescribing matters concerning reducing and exempting local tax and exceptions to local tax and matters concerning restrictions thereon.
 Article 2 (Definitions)
(1) The definitions of terms used in this Act shall be as follows: <Amended by Act No. 12175, Jan. 1, 2014; Act No. 12955, Dec. 31, 2014; Act No. 13637, Dec. 29, 2015; Act No. 13805, Jan. 19, 2016; Act No. 14477, Dec. 27, 2016; Act No. 15295, Dec. 26, 2017>
1. The term "unique duty" means a duty individually prescribed by statutes or a duty stipulated as an object in the corporate register;
2. The term "profit-making business" means profit-making business prescribed in Article 3 (3) of the Corporate Tax Act;
2-2. The term "housing" means housing defined in subparagraph 3 of Article 104 of the Local Tax Act;
3. The term "multi-family housing" means multi-family housing defined in subparagraph 3 of Article 2 of the Housing Act, other than dormitories;
4. The term "Seoul Metropolitan area" means the Seoul Metropolitan area defined in subparagraph 1 of Article 2 of the Seoul Metropolitan Area Readjustment Planning Act;
5. The term "over-concentration limitation zone" means an over-concentration control district prescribed in Article 6 (1) 1 of the Seoul Metropolitan Area Readjustment Planning Act;
6. The term "exceptions to local tax" means the reduction of tax rates, tax reduction or exemption, tax credits, deductions from the tax base (including exclusion from heavy taxation, and reclassification of property tax assessable subject matter), etc.;
7. The term "property tax" means an amount of tax imposed pursuant to Article 111 of the Local Tax Act;
8. The term "direct use" means the owner's direct use of the relevant real estate, motor vehicles, construction machinery, ships, aircraft, etc. to suit the purpose or usage for his/her business or work;
9. The term "national" is a resident or a domestic corporation subject to the Local Tax Act;
10. The term "taxable year" means a taxable period or business year under the Local Tax Act;
11. The term "tax return" means a report on tax base subject to Articles 95, 103-5, and 103-23 of the Local Tax Act;
12. The term "gross income" means the total amount of income subject to Article 24 of the Income Tax Act or the gross income subject to Article 14 of the Corporate Tax Act;
13. The term "deductible expenses" means necessary expenses subject to Article 27 of the Income tax Act or deductible expenses subject to Article 14 of the Corporate Tax Act;
14. The term “tax carried forward" means, where an individual transfers fixed assets, etc. used for the relevant business (hereafter in this subparagraph, referred to as "fixed assets, etc. for former business") to a corporation by investment in kind, etc., and the corporation that has acquired such fixed assets, etc. for former business, transfers them, the payment made by the corporation as corporate local income tax in the equivalent of the amount of individual local income tax calculated under Article 103-3 of the Local Tax Act (hereinafter referred to as "amount of individual local income tax calculated on capital gains") calculated deeming no other asset has been transferred by the individual during the taxable period in which the date of transfer of the fixed assets, etc. falls, for former business to the corporation, instead of individual local income tax on capital gains to be imposed on the individual under Article 103 of the Local Tax Act (hereinafter referred to as "individual local income tax on capital gains").
(2) Except as otherwise expressly provided for in this Act, the definitions of terms in this Act shall be governed by the Framework Act on Local Taxes, the Local Tax Collection Act, and the Local Tax Act: Provided, That the definitions of terms used in Chapter III Special Provisions on Local Income Taxes shall be governed by Article 2 of the Restriction of Special Taxation Act, except in cases prescribed by the Framework Act on Local Taxes, the Local Tax Collection Act, and the Local Tax Act. <Amended by Act No. 12175, Jan. 1, 2014; Act No. 14474, Dec. 27, 2016>
 Article 2-2 (Principle of Exceptions to Local Tax)
Where the Minister of the Interior and Safety and local governments intend to prescribe exceptions to local tax, they shall comprehensively consider the public interest character, socio-economic policies of the State, equality in taxation, ability of the person entitled to exceptions to local tax to assume tax, financial status of local governments, etc. <Amended by Act No. 11690, Mar. 23, 2013; Act No. 12844, Nov. 19, 2014; Act No. 14839, Jul. 26, 2017>
[This Article Newly Inserted by Act No. 10417, Dec. 27, 2010]
 Article 3 (Restrictions on Exceptions to Local Tax)
(1) No exception to any local tax regarding general taxation prescribed by the Local Tax Act shall be allowed, other than as expressly provided for in this Act, the Framework Act on Local Taxes, the Local Tax Collection Act, the Local Tax Act, the Restriction of Special Taxation Act, or a treaty. <Amended by Act No. 13637, Dec. 29, 2015; Act No. 14474, Dec. 27, 2016>
(2) If the head of a relevant administrative agency intends to amend Acts to change the scope of an exception for corporations, etc. granted exceptions to local tax as prescribed by this Act, he/she shall pre-consult with the Minister of the Interior and Safety. <Amended by Act No. 11690, Mar. 23, 2013; Act No. 12844, Nov. 19, 2014; Act No. 14839, Jul. 26, 2017>
 Article 4 (Local Tax Reduction or Exemption under Municipal Ordinance)
(1) Where any of the following cases arises, local governments may grant reduction of a local tax rate, tax reduction or exemption, or tax credits (hereafter in this Article and Article 182, referred to as "local tax reduction or exemption") for up to three years: Provided, That no local tax reduction or exemption prescribed by this Act (excluding Chapter III Special Provisions on Local Income Taxes) shall be further extended: <Amended by Act No. 10417, Dec. 27, 2010; Act No. 12175, Jan. 1, 2014; Act No. 12506, Mar. 24, 2014>
1. When deemed necessary to reduce or exempt local tax for the public interest, including providing support for people's livelihood, improving habitats of farming and fishing villages, supporting to expand public transportation, etc.;
2. When deemed necessary to reduce or exempt local tax for developing specific areas and providing support to specific industries and facilities.
(2) Notwithstanding paragraph (1), no local government shall be allowed to grant any of the following local tax reductions or exemptions: <Newly Inserted by Act No. 10417, Dec. 27, 2010; Act No. 11690, Mar. 23, 2013; Act No. 12175, Jan. 1, 2014; Act No. 12844, Nov. 19, 2014; Act No. 14839, Jul. 26, 2017>
1. Local tax reduction or exemption by excluding heavy taxation prescribed in Articles 13 and 28 (2) of the Local Tax Act;
2. Local tax reduction or exemption by reclassifying property tax assessable subject matter on land prescribed under Article 106 (1) of the Local Tax Act;
2-2. Local tax reduction or exemption on those excluded from reduction or exemption prescribed in Article 177;
3. Matters prescribed and publicly announced by the Minister of the Interior and Safety, as prescribed by Presidential Decree, which are local tax reduction or exemption, etc. substantially compromising impartiality of taxation or inappropriate local tax reduction or exemption, etc. in light of the national economic policy.
(3) If a local government intends to reduce or exempt local tax (excluding reductions or exemptions delegated by this Act or the Restriction of Special Taxation Act), it shall prescribe the same by municipal ordinance following deliberation by the relevant local tax deliberation committee prescribed in Article 147 of the Framework Act on Local Taxes. In such cases, where a local government intends to establish, extend, or modify local tax reduction or exemption on at least the scale prescribed by Presidential Decree, it shall request a tax-related specialized institution, corporation, or organization prescribed by Presidential Decree to analyze and evaluate the expediency, result, efficiency, etc. of reduction or exemption and utilize the report on such analysis and evaluation as deliberative materials. <Amended by Act No. 10417, Dec. 27, 2010; Act No. 12955, Dec. 31, 2014; Act No. 14474, Dec. 27, 2016>
(4) Notwithstanding paragraphs (1) and (3), the head of a local government may reduce or exempt local tax for a person to whom reduction or exemption of local tax is deemed necessary due to a natural disaster or a special ground prescribed by Presidential Decree, following a resolution by the relevant local council. <Amended by Act No. 10417, Dec. 27, 2010; Act No. 13637, Dec. 29, 2015>
(5) Local governments shall rationalize matters concerning local tax reduction or exemption, and the heads of local governments shall submit the results of rationalization to the Minister of the Interior and Safety. In such cases, the Minister of the Interior and Safety may utilize the results of rationalization to formulate, etc. a policy on local tax reduction or exemption. <Amended by Act No. 11690, Mar. 23, 2013; Act No. 12844, Nov. 19, 2014; Act No. 14839, Jul. 26, 2017>
(6) Where a local government reduces or exempts local tax in accordance with paragraphs (1) through (3), it shall prescribe the same by municipal ordinance within the amount (hereafter in this Article, referred to as "extent of local tax reduction or exemption") calculated by multiplying the amount of local taxes collected as at the closing of accounts for the year before the previous year, by a rate prescribed by Presidential Decree. <Newly Inserted by Act No. 10417, Dec. 27, 2010>
(7) Where the amount of local tax reduced or exempted by municipal ordinance under paragraph (6) exceeds the extent of local tax reduction or exemption, a local government may prescribe local tax reduction or exemption for the proceeding year by municipal ordinance within the extent of local tax reduction or exemption curtailed or rationalized, as prescribed by Presidential Decree: Provided, That where it is to be prescribed in excess of the extent of local tax reduction or exemption, prescribed by municipal ordinance with permission from the Minister of the Interior and Safety, such local tax reduction or exemption shall be excluded from that subject to curtailing or rationalization of local tax reduction or exemption. <Newly Inserted by Act No. 10417, Dec. 27, 2010; Act No. 11690, Mar. 23, 2013; Act No. 12844, Nov. 19, 2014; Act No. 13637, Dec. 29, 2015; Act No. 14839, Jul. 26, 2017>
(8) Where local tax reduction or exemption prescribed in paragraph (1) is prescribed by municipal ordinance, paragraphs (2), (6), and (7) shall not apply to Jeju Special Self-Governing Province. <Newly Inserted by Act No. 10417, Dec. 27, 2010; Act No. 13637, Dec. 29, 2015>
 Article 5 (Preparation of Local Tax Disbursement Reports)
(1) The head of each local government shall prepare a report on the outcomes of financial assistance granted pursuant to exceptions to local tax, such as local tax reduction or exemption, for the immediately preceding fiscal year and on the amount estimated for the relevant fiscal year (hereinafter referred to as "local tax disbursement report"), and shall submit such report to the relevant local council.
(2) Methods, etc. for preparing a local tax disbursement report shall be determined by the Minister of the Interior and Safety. <Amended by Act No. 11690, Mar. 23, 2013; Act No. 12844, Nov. 19, 2014; Act No. 14839, Jul. 26, 2017>
CHAPTER II REDUCTION AND DEDUCTION
SECTION 1 Support for Agriculture and Fisheries
 Article 6 (Reduction or Exemption for Farmland, etc. of Self-Employed Farmers)
(1) Acquisition tax shall be reduced by 50/100 until December 31, 2020 on farmland (referring to a paddy field, field, orchard, and land for stock farms; hereafter in this Section, the same shall apply) acquired for direct cultivation according to the standards prescribed by Presidential Decree, or on woodland acquired for creating farmland as prescribed by relevant statutes, by a person who has engaged in farming for at least two years, or an agricultural business successor referred to in Article 10 of the Act on Fostering and Supporting Agricultural and Fisheries Business Entities (hereafter in this Article, referred to as "self-employed farmer"), as prescribed by Presidential Decree: Provided, That the reduced portion of acquisition tax shall be collected as a penalty in any of the following cases: <Amended by Act No. 10417, Dec. 27, 2010; Act No. 11138, Dec. 31, 2011; Act No. 13637, Dec. 29, 2015; Act No. 14477, Dec. 27, 2016; Act No. 15295, Dec. 26, 2017>
1. Where the relevant person fails to cultivate such farmland directly or to commence creating farmland, as a self-employed farmer, without justifiable grounds, within two years from the date of acquisition;
2. Where such farmland or woodland is sold, donated, or used for any other purpose, after having been cultivated directly for less than two years.
(2) Acquisition tax shall be reduced by 50/100 until December 31, 2020 on any of the following agricultural facilities acquired by a self-employed farmer to use for agriculture: <Amended by Act No. 12955, Dec. 31, 2014; Act No. 15295, Dec. 26, 2017>
1. Buildings for sericulture or mushroom growing, and fixed greenhouses;
2. Cattle sheds and facilities to treat livestock wastewater and manure;
3. Warehouses (applicable only to cold stores, ambient temperature warehouses, and warehouses to store agricultural machinery) and facilities to sort and treat agricultural products.
(3) Registration license tax shall be exempted until December 31, 2018 on a license to occupy and use a road, river, or public waters, which is obtained by a self-employed farmer to use for cultivation. <Amended by Act No. 13637, Dec. 29, 2015; Act No. 15295, Dec. 26, 2017>
(4) Acquisition tax shall be reduced by 50/100 until December 31, 2018, on farmland acquired for direct cultivation by a person taking occupancy in a rural community defined in subparagraph 5 of Article 3 of the Framework Act on Agriculture, Rural Community and Food Industry, as prescribed by Presidential Decree (hereafter in this paragraph, referred to as "returning farmers") within three years from the date returning to farming prescribed by Presidential Decree (hereafter in this paragraph, referred to as "date returning to farming"), and on woodland acquired for creating farmland, as prescribed by relevant statutes, such as the Farmland Act: Provided, That where a returning farmer falls under any of the following cases without just grounds, the reduced portion of acquisition tax shall be collected as a penalty, but, in cases falling under subparagraph 3 or 4, the reduced portion of acquisition tax only on the portion corresponding thereto, shall be collected as a penalty: <Newly Inserted by Act No. 10417, Dec. 27, 2010; Act No. 11138, Dec. 31, 2011; Act No. 12955, Dec. 31, 2014; Act No. 13383, Jun. 22, 2015; Act No. 14477, Dec. 27, 2016>
1. Where such returning farmer changes his/her resident registration address to an area, other than a Special Self-Governing City, Special Self-Governing Province, or Si/Gun/Gu (referring to an autonomous Gu in cases of Gus; hereinafter the same shall apply) in which acquired farmland or woodland is located; a Si/Gun/Gu adjacent to such area; or an area within a 20-kilometer radius from such farmland or woodland, within three years from the date returning to farming;
2. Where such returning farmer engages in an industry, other than agriculture defined in subparagraph 1 of Article 3 of the Framework Act on Agriculture, Rural Community and Food Industry (hereafter in this paragraph, referred to as "agriculture") within three years from the date returning to farming: Provided, That excluded herefrom shall be where such returning farmer concurrently engages in the food industry and agriculture defined in subparagraph 8 of Article 3 of the Framework Act on Agriculture, Rural Community and Food Industry;
3. Where such returning farmer fails to directly engage in cultivation within two years from the date such farmland was acquired, or fails to commence creating farmland within two years from the date such woodland was acquired;
4. Where such returning farmer sells or donates such farmland or woodland or uses it for any other purpose, after having been cultivated for less than three years.
 Article 7 (Reduction or Exemption for Agricultural Machinery, etc.)
(1) Acquisition tax shall be exempted on agricultural machinery defined in the Agricultural Mechanization Promotion Act, such as automatic cultivators for direct use in agriculture (including where it is used for transporting agricultural products, etc. for farming). <Amended by Act No. 13637, Dec. 29, 2015>
(2) Acquisition tax and property tax shall be exempted on well facilities for supplying agricultural water. <Amended by Act No. 13637, Dec. 29, 2015>
 Article 8 (Exemption, etc. for Expansion and Development of Farmland)
(1) Acquisition tax shall be exempted until December 31, 2019, on farmland acquired by implementing an agricultural infrastructure improvement project prescribed in the Rearrangement of Agricultural and Fishing Villages Act and on reclaimed farmland acquired by implementing a farmland expansion and development project prescribed in the same Act. <Amended by Act No. 12955, Dec. 31, 2014; Act No. 13637, Dec. 29, 2015; Act No. 14477, Dec. 27, 2016>
(2) Acquisition tax shall be exempted until December 31, 2019, on farmland exchanged, subdivided, or combined pursuant to the Rearrangement of Agricultural and Fishing Villages Act or the Korea Rural Community Corporation and Farmland Management Fund Act and on farmland exchanged, subdivided, or combined within an agricultural promotion area. <Amended by Act No. 12955, Dec. 31, 2014; Act No. 13637, Dec. 29, 2015; Act No. 14477, Dec. 27, 2016>
(3) Acquisition tax shall be exempted on the acquisition of woodland exchanged, subdivided, or combined, by a person who engages in forestry or by a successor to forestry to directly engage in forestry, as prescribed by Presidential Decree; and where a person who engages in forestry or a successor to forestry acquires a mountain conservation district (limited to where an area not exceeding 990,000 square meters is acquired; but where any mountain conservation district is additionally acquired, limited to where the total area aggregated with the area of mountain conservation district already owned does not exceed 990,000 square meters) designated pursuant to the Mountainous Districts Management Act, acquisition tax thereon shall be reduced by 50/100 until December 31, 2020. <Amended by Act No. 13637, Dec. 29, 2015; Act No. 15295, Dec. 26, 2017>
(4) Acquisition tax on farmland acquired by filling or reclaiming land from public waters in accordance with the Public Waters Management and Reclamation Act shall be imposed at applying 8/1,000 until December 31, 2018, notwithstanding the tax rate prescribed in Article 11 (1) 3 of the Local Tax Act: Provided, That where such farmland is used for any other purpose within two years from the date of acquisition, the reduced portion of acquisition tax shall be collected as a penalty. <Amended by Act No. 13637, Dec. 29, 2015; Act No. 15295, Dec. 26, 2017>
 Article 9 (Reduction or Exemption for Self-Employed Fishermen, etc.)
(1) Acquisition tax shall be reduced by 50/100 until December 31, 2020 on fishing rights, fishing vessels (excluding fishing vessels specified in paragraph (2)), land (referring to the land, the category of which officially registered is fish farm under Article 67 of the Act on the Establishment, Management, etc. of Spatial Data) for use for any of the following fisheries, and buildings prescribed by Presidential Decree, which are acquired by a person prescribed by Presidential Decree among those engaging in commercial fishing, of by a successor to fisheries referred to in Article 10 of the Act on Fostering and Supporting Agricultural and Fisheries Business Entities to directly engage in fishery according to standards prescribed by Presidential Decree: <Amended by Act No. 11093, Nov. 22, 2011; Act No. 13637, Dec. 29, 2015; Act No. 15295, Dec. 26, 2017>
1. Business of cultivation in inland sea water under Article 41 (3) 2 of the Fisheries Act;
2. Business of cultivation in inland waters under Article 11 (2) of the Inland Water Fisheries Act;
3. Business for producing seeds for fisheries in inland water tanks and business for producing seeds for fisheries in ponds under the Fisheries Seed Industry Promotion Act.
(2) Acquisition tax, property tax, and local resource and facility tax prescribed in Article 146 (2) of the Local Tax Act, shall be exempted on a small fishing vessel of less than 20 tons. <Amended by Act No. 13637, Dec. 29, 2015>
(3) Acquisition tax shall be exempted on fishing rights acquired on application; and where a license arising from registration other than for establishment, among licenses concerning fishing rights, is newly obtained or such license is modified, registration license tax on the license shall be exempted. <Amended by Act No. 13637, Dec. 29, 2015>
 Article 10 (Reduction or Exemption, etc. concerning Loans to Farmers, Fishermen, etc.)
(1) Registration license tax shall be reduced by 50/100 until December 31, 2020, on the registration of security provided when the following cooperatives, the federation thereof, etc. provide a farmer or fisherman (including agricultural partnerships, fisheries partnerships, and agricultural companies; hereafter in this Article, the same shall apply) with a loan: Provided, That in cases of a federation of cooperatives, the NongHyup Bank, or the Suhyup Bank, it shall be limited to where farming funds, fishery funds, forestry funds, or funds for cattle breeding are financed: <Amended by Act No. 11138, Dec. 31, 2011; Act No. 11618, Jan. 1, 2013; Act No. 12955, Dec. 31, 2014; Act No. 13637, Dec. 29, 2015; Act No. 14477, Dec. 27, 2016; Act No. 15295, Dec. 26, 2017>
1. A cooperative and the NongHyup Bank incorporated pursuant to the Agricultural Cooperatives Act;
2. A cooperative (including fishing community fraternities) and the Suhyup Bank incorporated pursuant to the Fisheries Cooperatives Act;
3. A forestry cooperative and federation thereof incorporated pursuant to the Forestry Cooperatives Act;
4. A credit union and federation thereof incorporated pursuant to the Credit Unions Act;
5. A community credit cooperative and federation thereof incorporated pursuant to the Community Credit Cooperatives Act.
(2) The pro rata property portion and the pro rata employee portion of resident tax shall be exempted until December 31, 2018, on a place of business used directly by a farmer or fisherman for farming, forestry, cattle breeding, aquaculture, catching fish, etc. <Amended by Act No. 13637, Dec. 29, 2015>
 Article 11 (Reduction or Exemption for Agricultural Corporations)
(1) Acquisition tax on real estate acquired by any of the following agricultural corporations (hereafter in this Article, referred to as "agricultural corporation") within two years from the date of registration for incorporation to use for farming shall be exempted until December 31, 2019: <Amended by Act No. 11618, Jan. 1, 2013; Act No. 13637, Dec. 29, 2015; Act No. 15295, Dec. 26, 2017>
(2) Acquisition tax on real estate acquired by an agricultural corporation to use directly for farming, distribution, and processing shall be reduced by 50/100; and property tax on real estate used directly for the relevant use as at the tax base date shall be reduced by 50/100 until December 31, 2020, respectively. <Amended by Act No. 11618, Jan. 1, 2013; Act No. 13637, Dec. 29, 2015; Act No. 14477, Dec. 27, 2016; Act No. 15295, Dec. 26, 2017>
(3) When any reduction or exemption is applied under paragraph (1) or (2), the reduced or exempted portion of acquisition tax shall be collected as a penalty in any of the following cases: <Newly Inserted by Act No. 12955, Dec. 31, 20143; Act No. 14477, Dec. 27, 2016>
1. Where the real estate has not been used directly for the relevant purpose without just grounds, within one year from the date of acquisition;
2. Where the real estate has been sold, donated, or used for any other purpose, after having been used directly for the relevant purpose for less than three years;
3. Where an order for dissolution is received pursuant to Article 20-3 of the Act on Fostering and Supporting Agricultural and Fisheries Business Entities after the real estate has been used directly for the relevant purpose for less than five years.
(4) Registration license tax on registration to incorporate an agricultural corporation shall be exempted until December 31, 2020. <Newly Inserted by Act No. 15295, Dec. 26, 2017>
 Article 12 (Reduction or Exemption for Fisheries Corporations)
(1) Acquisition tax on real estate acquired by any of the following fisheries corporations (hereafter in this Article, referred to as "fisheries corporation") to use directly for fisheries, distribution, and processing, shall be reduced by 50/100; and property tax on real estate used directly for the relevant purpose as at the tax base date shall be reduced by 50/100 until December 31, 2020, respectively. <Amended by Act No. 11618, Jan. 1, 2013; Act No. 13637, Dec. 29, 2015; Act No. 14477, Dec. 27, 2016; Act No. 15295, Dec. 26, 2017>
(2) Registration license tax on registration to incorporate a fisheries corporation shall be exempted until December 31, 2020. <Amended by Act No. 11618, Jan. 1, 2013; Act No. 13637, Dec. 29, 2015; Act No. 14477, Dec. 27, 2016; Act No. 15295, Dec. 26, 2017>
(3) When any reduction or exemption is applied under paragraph (1), the reduced or exempted portion of acquisition tax shall be collected as a penalty in any of the following cases: <Newly Inserted by Act No. 14477, Dec. 27, 2016>
1. Where the real estate has not been used directly for the relevant purpose without just grounds, within one year from the date of acquisition;
2. Where the real estate has been sold, donated, or used for any other purpose, after having been used directly for the relevant purpose for less than three years;
3. Where an order for dissolution is received pursuant to Article 20-3 of the Act on Fostering and Supporting Agricultural and Fisheries Business Entities after the real estate has been used directly for the relevant purpose for less than five years.
 Article 13 (Reduction or Exemption for Agricultural Projects of Korea Rural Community Corporation)
(1) The following registrations made by the Korea Rural Community Corporation incorporated pursuant to the Korea Rural Community Corporation and Farmland Management Fund Act shall be exempted from registration license tax until the date provided for in the relevant subparagraphs, respectively: <Amended by Act No. 10890, Jul. 21, 2011; Act No. 11618, Jan. 1, 2013>
1. Registration of security provided when the Korea Rural Community Corporation lends farmland management funds to farmers (including agricultural partnerships and agricultural companies; hereafter in this paragraph, the same shall apply) pursuant to the Korea Rural Community Corporation and Farmland Management Fund Act, and registration of land leased pursuant to Article 19 of the same Act: Until December 31, 2014;
2. Registration of security provided when the Korea Rural Community Corporation lends funds to farmers to facilitate the implementation of the Free Trade Agreements for subsidizing projects for expanding farming scale under Article 5 (1) 1 of the Special Act on Assistance to Farmers, Fishers, etc. Following the Conclusion of Free Trade Agreements, and registration of land leased by the Korea Rural Community Corporation: Until December 31, 2015.
(2) Local tax on real estate acquired by the Korea Rural Community Corporation shall be reduced or exempted until December 31, 2019, as follows: <Amended by Act No. 11618, Jan. 1, 2013; Act No. 12955, Dec. 31, 2014; Act No. 13637, Dec. 29, 2015; Act No. 14477, Dec. 27, 2016; Act No. 15295, Dec. 26, 2017>
1. Acquisition tax and property tax shall be reduced by 50/100, respectively, on real estate acquired and owned by the Korea Rural Community Corporation prescribed in Articles 18, 20, 24, and 44 of the Korea Rural Community Corporation and Farmland Management Fund Act, on farmland acquired under the Farmland Act;
1-2. Acquisition tax shall be reduced by 50/100 and property tax shall be exempted on land for agricultural infrastructure and facilities thereof, of the State or local governments acquired and owned according to a rearrangement plan for agricultural infrastructure of the State or local governments under the Rearrangement of Agricultural and Fishing Villages Act;
2. Acquisition tax shall be reduced by 50/100 (or 100/100 of acquisition tax, where acquired by repurchase), on real estate acquired by the Korea Rural Community Corporation prescribed in Article 24-3 (1) of the Korea Rural Community Corporation and Farmland Management Fund Act [including where the owner or universal successor acquires the relevant farmland by repurchase (hereinafter referred to as "acquisition by repurchase"; hereafter in this subparagraph, the same shall apply) as at the time such land is sold under Article 24-3 (3) of the same Act]; and property tax shall be reduced by 50/100 on real estate leased under Article 24-3 (1) of the same Act as at the tax base date;
3. Acquisition tax shall be reduced by 50/100 on farmland acquired and owned by the Korea Rural Community Corporation pursuant to Article 5 (1) 1 of the Special Act on Assistance to Farmers, Fishers, etc. Following the Conclusion of Free Trade Agreements;
4. Acquisition tax shall be reduced by 30/100 on real estate acquired temporarily by the Korea Rural Community Corporation to use directly for living environment rearrangement projects defined in subparagraph 10 of Article 2 of the Rearrangement of Agricultural and Fishing Villages Act, to supply to a third party in accordance with the plans of the State or local governments;
5. Acquisition tax shall be reduced by 50/100 on farmland acquired by the Korea Rural Community Corporation under Article 24-2 (2) of the Korea Rural Community Corporation and Farmland Management Fund Act.
(3) Public facilities, appurtenant land, and a public site to be devolved to the State or local governments pursuant to relevant statutes, being real estate in a housing site development zone and complex construction project zone, among real estate acquired under paragraph (2) 4, shall be exempted from property tax (including an amount imposed pursuant to Article 112 of the Local Tax Act) until December 31, 2018. In such cases, the scope of public facilities and appurtenant land shall be prescribed by Presidential Decree. <Amended by Act No. 11618, Jan. 1, 2013; Act No. 13637, Dec. 29, 2015>
 Article 14 (Reduction or Exemption for Agricultural and Fishery Projects, etc. of Agricultural Cooperatives, etc.)
(1) Acquisition tax shall be reduced by 25/100 until December 31, 2020, on the following real estate (including real estate allowed to be used as facilities for distributing agricultural and fishery products by distribution subsidiaries prescribed in Article 70 (1) of the Act on Distribution and Price Stabilization of Agricultural and Fishery Products; hereafter in this paragraph, the same shall apply) acquired by the National Agricultural Cooperative Federation, the National Federation of Fisheries Cooperatives, or the National Forestry Cooperatives Federation to use directly for the projects of purchase, sale, etc.; and property tax shall be reduced by 25/100 until December 31, 2020, on real estate used directly for such projects as at the tax base date: <Amended by Act No. 11618, Jan. 1, 2013; Act No. 12955, Dec. 31, 2014; Act No. 13637, Dec. 29, 2015; Act No. 15295, Dec. 26, 2017>
1. Land and buildings for projects for purchase, sale, storing, processing, and trade;
2. Land and buildings for projects for production and inspection;
3. Land and buildings for facilities for educating farmers and fishermen.
(2) Acquisition tax shall be reduced by 25/100 until December 31, 2016, on real estate (excluding rental real estate; hereafter in this paragraph, the same shall apply) acquired by the National Agricultural Cooperative Federation, the National Federation of Fisheries Cooperatives, the National Forestry Cooperatives Federation, or the Korea Tobacco Growers Organization to use for projects for education, guidance, and assistance for members and projects for facilities to be used jointly. <Amended by Act No. 11618, Jan. 1, 2013; Act No. 12955, Dec. 31, 2014>
1. and 2. Deleted <by Act No. 12955, Dec. 31, 2014>
(3) Acquisition tax shall be exempted until December 31, 2017, on real estate (excluding rental real estate; hereafter in this paragraph, the same shall apply) acquired by a cooperative (including a corporation for joint business among cooperatives) incorporated pursuant to the Agricultural Cooperatives Act; cooperative (including a fishing village union and a corporation for joint business among cooperatives) incorporated pursuant to the Fisheries Cooperatives Act; forestry cooperative (including a forestry union and a corporation for joint business among cooperatives) incorporated pursuant to the Forestry Cooperatives Act; or tobacco growers' cooperative to use directly for its unique duties; and property tax shall be exempted until December 31, 2020 on real estate used directly for its unique duties as at the tax base date. <Amended by Act No. 11397, Mar. 21, 2012; Act No. 11618, Jan. 1, 2013; Act No. 12955, Dec. 31, 2014; Act No. 13637, Dec. 29, 2015; Act No. 14477, Dec. 27, 2016; Act No. 15295, Dec. 26, 2017>
(4) The pro rata property portion and pro rata employee portion of resident tax shall be reduced by 50/100 until December 31, 2014, on a cooperative (including a corporation for joint business among cooperatives) incorporated pursuant to the Agricultural Cooperatives Act; cooperative incorporated pursuant to the Forestry Cooperatives Act; forestry cooperative incorporated pursuant to the Forestry Cooperatives Act; or tobacco growers' cooperative. <Amended by Act No. 11618, Jan. 1, 2013; Act No. 12175, Jan. 1, 2014>
(5) None of the aforementioned provisions for reduction or exemption shall apply to the Federations of the cooperatives prescribed in paragraphs (3) and (4). <Amended by Act No. 13637, Dec. 29, 2015>
 Article 14-2 (Reduction for Projects for Purchase, Sale, etc. of Nonghyup Agribusiness Group, etc.)
Acquisition tax shall be reduced by 25/100 until December 31, 2017, on the following real estate (including real estate to be used by a subsidiary distribution company incorporated under Article 70 (1) of the Act on Distribution and Price Stabilization of Agricultural and Fishery Products as distribution facilities; hereafter in this paragraph, the same shall apply) acquired by Nonghyup Agribusiness Group incorporated under Article 161-2 of the Agricultural Cooperatives Act and its subsidiaries incorporated under Article 6 of the Addenda to the Agricultural Cooperatives Act (Act No. 10522) to use directly for projects for purchase, sale, etc.; and property tax shall be reduced by 25/100 until December 31, 2017 on real estate used directly for such projects as at the tax base date: <Amended by Act No. 13637, Dec. 29, 2015; Act No. 14481, Dec. 27, 2016>
1. Land and buildings for projects for purchase, sale, keeping, processing, and trade;
2. Land and buildings for projects for production and inspection;
3. Land and buildings for facilities for educating farmers and fishermen.
[This Article Newly Inserted by Act No. 12955, Dec. 31, 2014]
 Article 15 (Reduction or Exemption for Agro-Fisheries Projects, etc. of the Korea Agro-Fisheries and Food Trade Corporation, etc.)
(1) Acquisition tax shall be reduced by 50/100 until December 31, 2020, on real estate acquired by the Korea Agro-Fisheries and Food Trade Corporation incorporated pursuant to the Korea Agro-Fisheries and Food Trade Corporation Act or any distribution subsidiary prescribed in Article 70 (1) of the Act on Distribution and Price Stabilization of Agricultural and Fishery Products, to use directly for distribution facilities of agricultural and fishery products, including a general agro-fishery products market; and facilities for education and training on the distribution of agricultural and fishery products (including where the relevant real estate is used by a wholesale market corporation, market wholesaler, or intermediate wholesaler defined in subparagraphs 7 through 9 of Article 2 of the Act on Distribution and Price Stabilization of Agricultural and Fishery Products or other retailers for its unique duties; hereafter in this Article, the same shall apply); and property tax shall be reduced by 50/100 until December 31, 2020, on real estate used directly for such facilities as at the tax base date. <Amended by Act No. 10932, Jul. 25, 2011; Act No. 11618, Jan. 1, 2013; Act No. 12955, Dec. 31, 2014; Act No. 13637, Dec. 29, 2015; Act No. 15295, Dec. 26, 2017>
(2) Local tax shall be reduced or exempted until December 31, 2019 on a local government-invested public corporation incorporated pursuant to the Local Public Enterprises Act (hereinafter referred to as "agricultural and marine products corporation") to facilitate distributing agricultural and marine products and to maintain reasonable prices, as prescribed in the following: <Newly Inserted by Act No. 11138, Dec. 31, 2011; Act No. 12175, Jan. 1, 2014; Act No. 14477, Dec. 27, 2016>
1. Acquisition tax on real estate acquired to use directly for its unique duties shall be reduced by an amount calculated by multiplying 100/100 (where a municipal ordinance prescribes otherwise within 100/100, such rate shall apply) of acquisition tax by the proportion of stocks held by the local government (referring to the proportion of stocks (including stocks in which the local government is deemed invested pursuant to Article 53 (4) of the Local Public Enterprises Act) held by the local government, among all stocks issued by the relevant agricultural and marine products corporation; hereafter in this Article, the same shall apply), or exempted;
2. Registration license tax on the registration of the corporation shall be reduced by an amount calculated by multiplying 100/100 (where a municipal ordinance prescribes otherwise within 100/100, such rate shall apply) of registration license tax by the proportion of stocks held by the local government, or exempted;
3. Property tax on real estate used directly for its unique duties as at the tax base date shall be reduced by an amount calculated by multiplying 100/100 (where a municipal ordinance prescribes otherwise within 100/100, such rate shall apply) of property tax (including an amount imposed pursuant to Article 112 of the Local Tax Act) by the proportion of stocks held by the local government, or exempted.
 Article 16 (Reduction or Exemption for Improvement of Housing in Agricultural and Fishing Villages)
Acquisition tax shall be exempted until December 31, 2018 on a house with an area for exclusive use by its occupants, not exceeding 100 square meters (appurtenant land shall be limited to a portion not exceeding seven times the projected horizontal area of the building) acquired by a person (in cases of an over-concentration limitation zone, limited to a person who proves by a resident registration card, etc., prescribed in the Resident Registration Act, that he/she has been residing for at least one year in such zone), who resides in the relevant Special Self-Governing City, Special Self-Governing Province, or Si/Gun/Gu, subject to housing improvement by his/her personal effort according to a project plan for residence with his/her family as a person selected as subject to housing improvement according to a project plan prescribed by Presidential Decree; and property tax on the relevant house shall be exempted for five years from the date the first tax liability arises after acquisition of the relevant house. <Amended by Act No. 12955, Dec. 31, 2014; Act No. 13637, Dec. 29, 2015; Act No. 14477, Dec. 27, 2016>
SECTION 2 Support for Social Welfare
 Article 17 (Reduction or Exemption for Motor Vehicles for Persons with Disabilities)
(1) Acquisition tax and motor vehicle tax on any of the following vehicles shall be respectively exempted until December 31, 2018, if it is acquired by a person with a disability prescribed by Presidential Decree (excluding persons of distinguished service to the State, etc. referred to in Article 29 (4); hereafter in this Article, referred to as "person with a disability") to use for prosthesis or occupational activities and for which an application to reduce or exempt acquisition tax or motor vehicle tax prescribed in Article 125 (1) of the Local Tax Act (hereinafter referred to as "motor vehicle tax"), is first filed: <Amended by Act No. 12955, Dec. 31, 2014; Act No. 13637, Dec. 29, 2015; Act No. 14477, Dec. 27, 2016; Act No. 15295, Dec. 26, 2017>
1. Any of the following passenger motor vehicles:
(a) Passenger motor vehicle with an engine displacement not exceeding 2,000 cubic centimeters;
(b) Passenger motor vehicle prescribed by Presidential Decree that carries between seven and ten passengers. In this regard, the fixed number of passengers of a passenger motor vehicle, the structure of which has been altered shall be based on the number of passengers fixed before altering the structure;
(c) Motor vehicle reclassified from a cargo motor vehicle to a passenger motor vehicle as of January 1, 2006 under the Motor Vehicle Management Act (excluding a motor vehicle classified as a passenger motor vehicle since before December 31, 2005);
2. Van that carries not more than 15 passengers;
3. Cargo motor vehicle with a load capacity not exceeding one ton;
4. Two-wheeled motor vehicle with an engine displacement not exceeding 250 cubic centimeters.
(2) Where a person with a disability acquires a substitute motor vehicle (referring to acquiring a new motor vehicle falling under any subparagraph of paragraph (1), after canceling or transferring registration of a motor vehicle, with acquisition tax reduced or exempted pursuant to paragraph (1); and including where the registration of a motor vehicle, with acquisition tax reduced or exempted pursuant to paragraph (1), is cancelled or transferred, within 60 days from the date it was acquired and registered), as prescribed by Presidential Decree, acquisition tax and motor vehicle tax on the relevant motor vehicle shall be exempted as prescribed in paragraph (1). <Newly Inserted by Act No. 14477, Dec. 27, 2016>
(3) For the purposes of paragraphs (1) and (2), where a person with a disability or a person jointly registered with a person with a disability transfers ownership without justifiable grounds, such as death, divorce, emigration, cancellation of a driving license, or grounds similar thereto, or establishes a branch family within one year from the date of registration of a motor vehicle, the exempted portion of acquisition tax shall be collected as a penalty: Provided, That this shall not apply where the ownership of a person eligible to be jointly registered with a person with a disability has been transferred to the person with a disability; where a person eligible to be jointly registered with a person with a disability has obtained a share of the ownership of the person with a disability; or where the registration of ownership has been exchanged between persons eligible to be jointly registered. <Amended by Act No. 14477, Dec. 27, 2016>
 Article 17-2 (Reduction or Exemption for Supporting Persons Affected by Hansen's Disease and Their Farming Settlements)
(1) Where a person affected by Hansen's disease or a person who had been affected by Hansen's disease and has since been completely healed (hereafter in this Article, referred to as "person affected by Hansen's disease") acquires any of the following real estate within an area prescribed by Presidential Decree, taking the purpose of residence, residential types, etc. into consideration, among the areas where persons affected by Hansen's disease settle and reside collectively for treatment, rehabilitation, self-support, etc. (hereafter in this Article, referred to as "farming settlement of persons affected by Hansen's disease"), acquisition tax on such real estate shall be exempted until December 31, 2018: <Amended by Act No. 12175, Jan. 1, 2014; Act No. 13637, Dec. 29, 2015>
1. A house (limited to those with an exclusive use area not exceeding 85 square meters);
2. Real estate for cattle shed;
3. Real estate to be used directly for rehabilitation projects for persons affected by Hansen's disease (limited to where such real estate is acquired by the representative of a farming settlement of persons affected by Hansen's disease or by a person affected by Hansen's disease).
(2) Property tax (including an amount imposed pursuant to Article 112 of the Local Tax Act) and local resource and facility tax prescribed in Article 146 (2) of the Local Tax Act shall be exempted until December 31, 2018, respectively, on real estate within a farming settlement of persons affected by Hansen's disease (referring to real estate prescribed in each subparagraph of paragraph (1)) owned by a person affected by Hansen's disease as at the tax base date. <Amended by Act No. 12175, Jan. 1, 2014; Act No. 13637, Dec. 29, 2015>
[This Article Newly Inserted by Act No. 11138, Dec. 31, 2011]
 Article 18 (Reduction or Exemption for the Korea Employment Agency for Disabled)
Acquisition tax shall be reduced by 25/100 until December 31, 2019, on real estate (excluding real estate for profit-making business) acquired by the Korea Employment Agency for the Disabled, under the Act on the Employment Promotion and Vocational Rehabilitation of Persons with Disabilities, to use directly for the projects prescribed in Article 43 (2) 1 through 11 of the same Act; and property tax shall be reduced by 25/100 until December 31, 2019, on real estate used directly for such projects as at the tax base date, respectively. <Amended by Act No. 11618, Jan. 1, 2013; Act No. 13637, Dec. 29, 2015; Act No. 14477, Dec. 27, 2016>
 Article 19 (Reduction or Exemption for Child Care Centers and Kindergartens)
(1) Acquisition tax shall be exempted until December 31, 2018 on real estate acquired to establish and operate a child care center prescribed in the Infant Care Act or a kindergarten prescribed in the Early Childhood Education Act (hereafter in this Article, referred to as "kindergarten, etc."). <Amended by Act No. 12955, Dec. 31, 2014; Act No. 13637, Dec. 29, 2015>
(2) Property tax (including an amount imposed pursuant to Article 112 of the Local Tax Act) shall be exempted until December 31, 2018 on the following real estate: <Amended by Act No. 12955, Dec. 31, 2014; Act No. 13637, Dec. 29, 2015>
1. Real estate used directly by the owner thereof for a kindergarten, etc. as at the tax base date;
2. Real estate used for kindergarten, etc. as at the tax base date, which is prescribed by Presidential Decree, based upon the relationship, etc. between the owner and user of the relevant real estate.
[This Article Wholly Amended by Act No. 11138, Dec. 31, 2011]
 Article 19-2 (Reduction or Exemption for Welfare Facilities for Children)
Acquisition tax on real estate acquired to establish and operate a regional center for children under Article 52 (1) 8 of the Child Welfare Act and property tax (including an amount imposed pursuant to Article 112 of the Local Tax Act) on real estate used directly for a regional center for children as at the tax base date shall be exempted until December 31, 2020, respectively.
[This Article Newly Inserted by Act No. 15295, Dec. 26, 2017]
 Article 20 (Reduction or Exemption for Welfare Facilities for Elderly Persons)
Local tax shall be reduced or exempted until December 31, 2020 as follows, on real estate acquired to establish and operate a welfare facility for elderly persons under Article 31 of the Welfare of Older Persons Act: <Amended by Act No. 12175, Jan. 1, 2014; Act No. 12955, Dec. 31, 2014; Act No. 13637, Dec. 29, 2015; Act No. 15295, Dec. 26, 2017>
1. Acquisition tax shall be exempted on real estate acquired to use for a free welfare facility for elderly persons prescribed by Presidential Decree; and property tax shall be reduced by 50/100 on real estate used directly for welfare facilities for elderly persons (in cases of a religious organization, including where the representative thereof or a religious corporation that is not the owner of the relevant real estate, uses the relevant real estate for welfare facilities for elderly persons; hereafter in this Article, the same shall apply) as at the tax base date: Provided, That where real estate (including appurtenant facilities) is used for a social gathering hall for elderly persons for pastimes as at the tax base date, property tax (including an amount imposed pursuant to Article 112 of the Local Tax Act) and local resource and facility tax prescribed in Article 146 (2) of the same Act on such real estate shall be exempted, respectively;
2. Acquisition tax shall be reduced by 25/100 on real estate acquired to use for a welfare facility for elderly persons other than those referred to in subparagraph 1; and property tax shall be reduced by 25/100 on real estate used directly for a welfare facility for elderly persons other than those referred to in subparagraph 1 as at the tax base date.
 Article 21 (Reduction or Exemption for Youth Organizations, etc.)
(1) Acquisition tax shall be reduced by 75/100 until December 31, 2020 on real estate (excluding rental real estate) acquired by any of the following corporations or organizations to use directly for its unique duties, and property tax shall be exempted until December 31, 2020 on real estate used directly for its unique duties as at the tax base date: <Amended by Act No. 12955, Dec. 31, 2014; Act No. 13637, Dec. 29, 2015; Act No. 15295, Dec. 26, 2017>
1. Scout superintendent organizations, prescribed in the Scout Activities Support Act;
2. Korean Youth Association, prescribed in the Korean Youth Association Support Act;
3. Sea Explorers of Korea, prescribed in the Act on the Support for Sea Explorers of Korea;
4. Youth organizations prescribed by Presidential Decree, similar to those prescribed in subparagraphs 1 through 3.
(2) Acquisition tax shall be exempted until December 31, 2020 on real estate acquired by a nonprofit corporation permitted to establish a youth training facility prescribed in the Juvenile Activity Promotion Act; and property tax shall be reduced by 50/100 until December 31, 2020 on real estate used directly for such facility as at the tax base date. <Amended by Act No. 12329, Jan. 21, 2014; Act No. 12955, Dec. 31, 2014; Act No. 13637, Dec. 29, 2015; Act No. 15295, Dec. 26, 2017>
 Article 22 (Reduction or Exemption for Social Welfare Societies, etc.)
(1) Real estate acquired by a social welfare society established pursuant to the Social Welfare Services Act; an organization for social welfare projects prescribed by Presidential Decree, such as an asylum for the aged, a child care institute, an institute for mothers and children, a Hansen's disease treatment and protection center, etc.; and the Korea Hansen Welfare Association (hereafter in this Article, referred to as "social welfare society, etc."), to use directly for the relevant project, shall be exempted from acquisition tax until December 31, 2019: Provided, That the exempted portion of acquisition tax shall be collected as a penalty in any of the following cases: <Amended by Act No. 10417, Dec. 27, 2010; Act No. 11138, Dec. 31, 2011; Act No. 11618, Jan. 1, 2013; Act No. 12955, Dec. 31, 2014; Act No. 14477, Dec. 27, 2016>
1. Where such real estate is used commercially within five years from the date of acquisition;
2. Where such real estate is not used directly for the relevant purpose without just grounds within three years from the date of acquisition;
3. Where such real estate is sold, donated, or used for any other purpose, after having been used for the relevant purpose for less than two years.
(2) Real estate (including land appurtenant to a building prescribed by Presidential Decree) used by a social welfare society, etc. directly for the relevant project (in cases of a religious corporation, including where the representative thereof or a religious corporation that is not the owner of the relevant real estate, uses the relevant real estate for social welfare services; hereafter in this Article, the same shall apply) as at the tax base date, shall be exempted from property tax (including an amount imposed pursuant to Article 112 of the Local Tax Act) and local resource and facility tax prescribed in Article 146 (2) of the Local Tax Act, until December 31, 2019, respectively: Provided, That where such property is used commercially, or a fee is charged for use thereof; or part of such property is not used directly for its original purpose, no such taxes on such property or part thereof shall be exempted. <Amended by Act No. 11138, Dec. 31, 2011; Act No. 11618, Jan. 1, 2013; Act No. 12175, Jan. 1, 2014; Act No. 12955, Dec. 31, 2014; Act No. 13637, Dec. 29, 2015>
(3) A license to be used by a social welfare society, etc. directly for the project shall be exempted from registration license tax, and the relevant social welfare society, etc. shall be exempted from the pro rata property portion and the pro rata employee portion of resident tax, until December 31, 2019, respectively: Provided, That no social welfare society, etc. shall be exempted from the pro rata property portion and the pro rata employee portion of resident tax prescribed by Presidential Decree, that are related to profit-making business. <Amended by Act No. 11138, Dec. 31, 2011; Act No. 11618, Jan. 1, 2013; Act No. 12175, Jan. 1, 2014; Act No. 12955, Dec. 31, 2014; Act No. 13637, Dec. 29, 2015; Act No. 14477, Dec. 27, 2016>
(4) Where generated electricity, etc., is supplied to a social welfare society, etc. gratuitously, such portion shall be exempted from local resource and facility tax prescribed in Article 146 (1) of the Local Tax Act until December 31, 2019. <Amended by Act No. 11138, Dec. 31, 2011; Act No. 11618, Jan. 1, 2013; Act No. 12955, Dec. 31, 2014>
(5) The registration for establishment and the registration of merger of social welfare societies prescribed in the Social Welfare Services Act shall be exempted from registration license tax, and the place of business of the relevant social welfare facility managed by a person who operates a social welfare facility under the same Act shall be exempted from per capita resident tax until December 31, 2019, respectively. <Amended by Act No. 11138, Dec. 31, 2011; Act No. 11618, Jan. 1, 2013; Act No. 12955, Dec. 31, 2014; Act No. 13637, Dec. 29, 2015>
(6) Notwithstanding paragraphs (1) through (5), acquisition tax and property tax on real estate purchased or used by a social welfare society established pursuant to the Social Welfare Services Act to operate a medical institution shall be reduced, respectively, as follows: <Newly Inserted by Act No. 11618, Jan. 1, 2013; Act No. 12175, Jan. 1, 2014; Act No. 12955, Dec. 31, 2014>
1. Acquisition tax for the following periods, on real estate purchased to be used directly for medical services:
(a) Until December 31, 2016: 75/100;
(b) From January 1, 2017 to December 31, 2018: 50/100;
2. Property tax for the following periods, on real estate used directly for medical services as at the tax base date (including an amount imposed pursuant to Article 112 of the Local Tax Act):
(a) Until December 31, 2016: 75/100;
(b) From January 1, 2017 to December 31, 2018: 50/100.
 Article 22-2 (Reduction or Exemption for Support for Childbirth and Parenting)
(1) Where a person raising at least three children (hereafter in this Article, referred to as "person raising several children") under 18 years of age (based on the record in the family relation register; adopted children and the spouse's children shall be included, but adopted children shall be excluded from the number of children of biological parents) acquires and registers any of the following motor vehicles (motor vehicle classification shall be governed by Article 3 of the Motor Vehicle Management Act) until December 31, 2018 for the purpose of raising children, acquisition tax on a motor vehicle shall be exempted for the one motor vehicle for which an application for reduction or exemption is filed first, but acquisition tax of less than 1,400,000 won calculated under Article 12 (1) 2 of the Local Tax Act on a motor vehicle falling under subparagraph 1 (b) shall be exempted; and where acquisition tax exceeds 1,400,000 won, 1,400,000 won shall be deducted: Provided, That this shall not apply where reduction or exemption has been granted to such person's spouse or where joint registration with a person, other than his/her spouse has been made: <Amended by Act No. 11618, Jan. 1, 2013; Act No. 13637, Dec. 29, 2015>
1. Any of the following passenger motor vehicles:
(a) Passenger motor vehicle that can carry between seven and ten passengers;
(b) Passenger motor vehicle, other than that prescribed in item (a);
2. Van that carries 15 or less passengers;
3. Cargo motor vehicle with a load capacity not exceeding one ton;
4. Two-wheeled motor vehicle with an engine displacement not exceeding 250 cubic centimeters.
(2) Where a person raising several children registers a motor vehicle falling under any subparagraph of paragraph (1) by not later than December 31, 2018 by any of the following methods, acquisition tax on the relevant motor vehicle shall be reduced or exempted as prescribed in paragraph (1): <Amended by Act No. 14477, Dec. 27, 2016>
1. Where the person registers a motor vehicle to acquire by substitution [referring to acquiring a new motor vehicle after cancelling or transferring the registration of a motor vehicle (transfer of a motor vehicle between spouses shall not be deemed acquisition by substitution in this Article) after one year from the registration date of the motor vehicle, with acquisition tax reduced or exempted pursuant to paragraph (1); and including where the registration of a motor vehicle, with acquisition tax reduced or exempted pursuant to paragraph (1), is cancelled or transferred, within 60 days from the date it was acquired and registered], as prescribed by Presidential Decree;
2. Where a person raising several children transfers ownership of a motor vehicle, with acquisition tax reduced or exempted, to his/her spouse.
(3) Where the ownership of a motor vehicle, with acquisition tax reduced or exempted pursuant to paragraphs (1) and (2), is transferred without just grounds, such as death, marriage, emigration, cancellation of driver's license, or reasons similar thereto, within one year from the date of motor vehicle registration, the reduced or exempted portion of acquisition tax shall be collected as a penalty: Provided, That no reduced or exempted portion of acquisition tax shall be collected as a penalty, where a person raising several children for whom acquisition tax is reduced or exempted pursuant to the main sentence of paragraph (1), transfers ownership of the relevant motor vehicle to his/her spouse. <Amended by Act No. 14477, Dec. 27, 2016>
(4) Where a motor vehicle falls under any of the following cases with acquisition tax reduced or exempted pursuant to paragraphs (1) and (2), the owner shall be deemed not to own the motor vehicle and the provisions of acquisition tax reduction or exemption under paragraphs (1) and (2) shall apply regardless of whether such motor vehicle is registered in the owner's name: <Amended by Act No. 14477, Dec. 27, 2016>
1. Motor vehicle, the sale of which is verified as having been mediated as a used motor vehicle by a motor vehicle dealer under the Motor Vehicle Management Act (excluding a used vehicle which is not sold and returned to the owner);
2. Motor vehicle that the Special Self-Governing City Mayor, Special Self-Governing Province Governor, or the head of a Si/Gun/Gu (referring to the head of an autonomous Gu in cases of the head of a Gu; hereinafter referred to as "head of a Si/Gun") deems irretrievable or unusable because the relevant motor vehicle cannot be located, has been destroyed, or has been damaged due to a natural disaster, fire, traffic accident, etc.;
3. Motor vehicle that a motor vehicle scrapper prescribed by the Motor Vehicle Management Act certifies that it has been scrapped;
4. Motor vehicle, declared as exported, to the head of a customs house under the Customs Act and has been exported.
[This Article Newly Inserted by Act No. 10417, Dec. 27, 2010]
 Article 22-3 (Exemption for Microfinance Foundation)
Registration license tax shall be exempted until December 31, 2016, on the registration to incorporate (including registration to increase total investment or total property) the Microfinance Foundation [including a business execution organization established with permission from the Financial Services Commission only to perform support business for the financial livelihoods of ordinary people defined in subparagraph 5 of Article 2 of the Microfinance Support Act after August 1, 2008, among business execution organizations (limited to those prescribed by Presidential Decree) defined in subparagraph 6 of Article 2 of the same Act] established pursuant to the Microfinance Support Act. <Amended by Act No. 12955, Dec. 31, 2014; Act No. 13637, Dec. 29, 2015; Act No. 14095, Mar. 22, 2016>
[This Article Newly Inserted by Act No. 10417, Dec. 27, 2010]
 Article 22-4 (Reduction or Exemption for Social Enterprises)
Local tax shall be reduced until December 31, 2018, as follows, on a social enterprise defined in subparagraph 1 of Article 2 of the Social Enterprise Promotion Act (limited to small or medium enterprises referred to in Article 2 (1) of the Framework Act on Small and Medium Enterprises in cases of companies subject to the Commercial Act): <Amended by Act No. 12175, Jan. 1, 2014; Act No. 13637, Dec. 29, 2015>
1. Acquisition tax shall be reduced by 50/100 on real estate acquired to use directly for its unique duties: Provided, That the reduced portion of acquisition tax shall be collected as a penalty in any of the following cases:
(a) Where the certification of a social enterprise is revoked within three years from the date of acquisition, as prescribed in Article 18 of the Social Enterprise Promotion Act;
(b) Where such real estate is not used directly for the relevant purposes without just grounds, within one year from the date of acquisition;
(c) Where such real estate is sold, donated, or used for any other purpose, after having been used directly for the relevant purposes for less than two years;
2. Registration license tax shall be reduced by 50/100 on registration for incorporation;
3. Property tax shall be reduced by 25/100 on real estate used directly for its unique duties as at the tax base date.
[This Article Newly Inserted by Act No. 11138, Dec. 31, 2011]
 Article 23 (Reduction or Exemption to Increase, etc. Rights and Interests)
(1) Real estate (excluding rental real estate; hereafter in this Article, the same shall apply) acquired by a legal aid corporation prescribed in the Legal Aid Act, to use directly for its unique duties, shall be exempted from acquisition tax; and real estate used directly for its unique duties as at the tax base date, shall be exempted from property tax (including an amount imposed pursuant to Article 112 of the Local Tax Act) until December 31, 2019, respectively. <Amended by Act No. 14477, Dec. 27, 2016>
(2) Real estate acquired by the Korea Consumer Agency referred to in the Framework Act on Consumers, to use directly for its unique duties, shall be exempted from acquisition tax; and real estate used directly for its unique duties as at the tax base date shall be exempted from property tax (including an amount imposed pursuant to Article 112 of the Local Tax Act) until December 31, 2019, respectively. <Amended by Act No. 14477, Dec. 27, 2016>
[This Article Wholly Amended by Act No. 13637, Dec. 29, 2015]
 Article 24 (Reduction or Exemption for the National Pension Service, etc.)
(1) Local tax shall be reduced or exempted until December 31, 2014, as follows, on real estate acquired by the National Pension Service under the National Pension Act, to use directly for the duties prescribed in Article 25 of the same Act: <Amended by Act No. 11618, Jan. 1, 2013>
1. Acquisition tax and property tax shall be exempted on real estate for welfare promotion projects prescribed in subparagraph 4 of Article 25 of the National Pension Act;
2. Acquisition tax and property tax shall be reduced by 50/100 on real estate for other national pension projects entrusted pursuant to subparagraph 7 of Article 25 of the National Pension Act.
(2) Local tax shall be reduced or exempted until December 31, 2014, as follows, on real estate acquired by the Government Employees Pension Service under the Public Officials Pension Act, to use directly for projects prescribed in Article 16 of the same Act: <Amended by Act No. 11618, Jan. 1, 2013>
1. Acquisition tax and property tax shall be exempted on real estate acquired for projects prescribed in subparagraphs 4 and 5 of Article 16 of the Public Officials Pension Act;
2. Acquisition tax and property tax shall be reduced by 50/100 on real estate acquired for projects prescribed in subparagraphs 3 and 6 of Article 16 of the Public Officials Pension Act.
(3) Local tax shall be reduced or exempted until December 31, 2014, as follows, on real estate acquired by the Korea Teachers Pension under the Pension for Private School Teachers and Staff Act, to use directly for projects prescribed in Article 4 of the same Act: <Amended by Act No. 11618, Jan. 1, 2013>
1. Acquisition tax and property tax shall be exempted on real estate for projects prescribed in subparagraph 4 of Article 4 of the Pension for Private School Teachers and Staff Act;
2. Acquisition tax and property tax shall be reduced by 50/100 on real estate for projects prescribed in subparagraphs 3 and 5 of Article 4 of the Pension for Private School Teachers and Staff Act.
 Article 25 (Reduction or Exemption for Workers' Welfare)
(1) Acquisition tax shall be reduced by 50/100 until December 31, 2014, on real estate acquired by any of the following corporations, to construct multi-family housing for its members prescribed by Presidential Decree: <Amended by Act No. 11618, Jan. 1, 2013>
1. Military Personnel Mutual Aid Association established pursuant to the Military Personnel Mutual Aid Association Act;
2. Police Mutual Aid Association established pursuant to the Police Mutual Aid Association Act;
3. Public Officials Benefit Association established pursuant to the Public Officials Benefit Association Act;
4. Korean Teachers' Credit Union established pursuant to the Korean Teachers' Credit Union Act.
(2) Registration to incorporate a corporation for a fund and registration to modify a corporation for a fund under the Framework Act on Labor Welfare shall be exempted from registration license tax until December 31, 2016. <Amended by Act No. Jun. 8, 2010; Act No. 11618, Jan. 1, 2013; Act No. 13637, Dec. 29, 2015>
 Article 26 (Reduction or Exemption for Trade Unions)
Real estate (excluding real estate for profit-making business; hereafter in this Article, the same shall apply) acquired by a trade union established pursuant to the Trade Union and Labor Relations Adjustment Act, to use directly for its unique duties, shall be exempted from acquisition tax; and real estate used directly for its unique duties as at the tax base date shall be exempted from property tax until December 31, 2018, respectively. <Amended by Act No. 11618, Jan. 1, 2013; Act No. 13637, Dec. 29, 2015>
 Article 27 (Reduction or Exemption for Support for the Korea Workers' Compensation and Welfare Service)
(1) Acquisition tax shall be reduced by 25/100 on real estate acquired by the Korea Workers' Compensation and Welfare Service under the Industrial Accident Compensation Insurance Act (hereafter in this Article, referred to as the "Korea Workers' Compensation and Welfare Service"), to use directly for projects prescribed in Article 11 (1) 1 through 5, 6, and 7 of the same Act; and property tax shall be reduced by 25/100 on real estate used directly for such duties as at the tax base date, until December 31, 2019, respectively. <Amended by Act No. 11618, Jan. 1, 2013; Act No. 13637, Dec. 29, 2015; Act No. 14477, Dec. 27, 2016>
(2) Acquisition tax shall be reduced by 75/100 on real estate acquired by the Korea Workers' Compensation and Welfare Service, to use directly for medical projects and rehabilitation projects prescribed in Article 11 (1) 5-2 and 5-3 and (2) of the Industrial Accident Compensation Insurance Act; and property tax (including an amount imposed pursuant to Article 112 of the Local Tax Act) shall be reduced by 50/100 on real estate used directly for such duties as at the tax base date, until December 31, 2018, respectively. <Amended by Act No. 11618, Jan. 1, 2013; Act No. 12175, Jan. 1, 2014; Act No. 13637, Dec. 29, 2015; Act No. 14477, Dec. 27, 2016>
 Article 28 (Reduction or Exemption for Support for Industrial Human Resources, etc.)
(1) Acquisition tax shall be reduced by 50/100 until December 31, 2014, on land (limited to that less than ten times the projected horizontal area of a building) and a building acquired to use directly for a vocational skill training facility (including a lodging facility; hereafter in this paragraph, the same shall apply) under the Act on the Development of Vocational Skills of Workers; and property tax shall be exempted until December 31, 2014, on real estate used directly for a vocational skill training facility as at the tax base date. <Amended by Act No. 11618, Jan. 1, 2013>
(2) Acquisition tax shall be reduced by 25/100 on real estate acquired by the Korea Occupational Safety and Health Agency established pursuant to the Korea Occupational Safety and Health Agency Act, to use directly for projects prescribed in subparagraphs 2 and 6 of Article 6 of the same Act; acquisition tax shall be reduced by 25/100 on real estate acquired by the Human Resources Development Service of Korea established pursuant to the Human Resources Development Service of Korea Act, to use directly for projects prescribed in subparagraph 1 of Article 6 of the same Act; and property tax shall be reduced by 25/100 on real estate used directly for projects as at the tax base date, until December 31, 2019, respectively. <Amended by Act No. 11618, Jan. 1, 2013; Act No. 13637, Dec. 29, 2015; Act No. 14477, Dec. 27, 2016>
 Article 29 (Reduction or Exemption for Persons of Distinguished Service to State, etc.)
(1) Acquisition tax shall be exempted until December 31, 2020, on the following real estate acquired with loans prescribed in the Act on the Honorable Treatment of and Support for Persons, etc. of Distinguished Service to the State; the Act on Support for Persons Eligible for Veteran's Compensation; the Act on the Honorable Treatment of Persons of Distinguished Service to the May 18 Democratization Movement; or the Act on Honorable Treatment of Persons of Distinguished Service during Special Missions and Establishment of Related Organizations: <Amended by Act No. 11029, Aug. 4, 2011; Act No. 11042, Sep. 15, 2011; Act No. 12955, Dec. 31, 2014; Act No. 13637, Dec. 29, 2015; Act No. 15295, Dec. 26, 2017>
1. A house (including the portion exceeding a loan) with an area for exclusive use by its occupants, not exceeding 85 square meters;
2. Real estate (excluding the portion exceeding a loan), other than that prescribed in subparagraph 1.
(2) Organizations specified under subparagraph 1 shall be exempt from local taxes specified under subparagraph 2 until December 31, 2020: <Amended by Act No. 11138, Dec. 31, 2011; Act No. 12175, Jan. 1, 2014; Act No. 12955, Dec. 31, 2014; Act No. 13605, Dec. 22, 2015; Act No. 15295, Dec. 26, 2017>
1. Organizations to be granted exemption:
(a) The Korea Disabled Veterans Association; the Korea War Veterans' Bereaved Family Association; the Korea Veterans' Wives Association; the Korea Liberation Association; the April Revolution Association; the April Revolution Victims' Bereaved Family Association; the Persons of Distinguished Service to April Revolution Association; the Association of Student Volunteer Army from Residents in Japan; or the Korea Association of Persons of Distinguished Service established pursuant to the Act on the Establishment of Associations by Persons, etc. of Distinguished Service to the State;
(b) The Association of Persons of Distinguished Service during Special Military Mission established pursuant to the Act on Honorable Treatment of Persons of Distinguished Service during Special Missions and Establishment of Related Organizations;
(c) The Korean Association of Veterans Suffering from Aftereffects of Defoliants established pursuant to the Act on Assistance to Patients Suffering from Actual or Potential Aftereffects of Defoliants, etc. and Establishment of Related Organizations;
(d) The Korean War Veterans Association and the Vietnam War Veterans Association of Korea established pursuant to the Act on Honorable Treatment of War Veterans and Establishment of Related Associations;
2. Subject-matter of exemption:
(a) Acquisition tax on real estate acquired to use directly for its unique duties;
(b) Registration license tax on a license to use directly for its unique duties;
(c) Property tax (including property tax prescribed in Article 112 (1) 2 of the Local Tax Act) and local resource and facility tax prescribed in Article 146 (2) of the Local Tax Act, on real estate used directly for its unique duties as at the tax base date;
(d) The pro rata property portion and pro rata employee portion of resident tax on the relevant organization.
(3) Acquisition tax, property tax (including an amount imposed pursuant to Article 112 of the Local Tax Act), and local resource and facility tax prescribed in Article 146 (2) of the Local Tax Act shall be exempted until December 31, 2020 respectively, on real estate acquired and owned by seriously-injured persons classified as Grade 1 in the wound classification table as prescribed by Presidential Decree and residing in the self-support villages of persons of distinguished service to the State designated by the Minister of Patriots and Veterans Affairs; their bereaved families; or organizations consisting of such seriously-injured persons and bereaved families. <Amended by Act No. 12955, Dec. 31, 2014; Act No. 15295, Dec. 26, 2017>
(4) Acquisition tax and motor vehicle tax shall be exempted until December 31, 2018, respectively, on any of the following vehicles, if it is acquired by a person who has rendered distinguished service to the State referred to in the Act on the Honorable Treatment of and Support for Persons, etc. of Distinguished Service to the State and classified as any of Grades 1 through 7 in the wound classification table, or any other person prescribed by Presidential Decree (hereinafter referred to as "person who has rendered distinguished service to the State, etc."), to use for prosthesis or occupational activities, and for which an application to reduce or exempt acquisition tax or motor vehicle tax, is first filed: Provided, That where reduction or exemption is granted for a motor vehicle for a person with a disability pursuant to Article 17 (1) shall be excluded herefrom: <Newly Inserted by Act No. 13637, Dec. 29, 2015; Act No. 14477, Dec. 27, 2016>
1. Any of the following passenger motor vehicles:
(a) Passenger motor vehicle with an engine displacement not exceeding 2,000 cubic centimeters;
(b) Passenger motor vehicle prescribed by Presidential Decree that carries between seven and ten passengers;
(c) Motor vehicle reclassified from a cargo motor vehicle to a passenger motor vehicle as of January 1, 2006 under the Motor Vehicle Management Act (excluding a motor vehicle classified as a passenger motor vehicle since before December 31, 2005);
2. Van that carries not more than 15 passengers;
3. Cargo motor vehicle with a load capacity not exceeding one ton;
4. Two-wheeled motor vehicle with an engine displacement not exceeding 250 cubic centimeters.
(5) For the purposes of paragraph (4), where a person who has rendered distinguished service to the State, etc. or a person jointly registered with a person who has rendered distinguished service to the State, etc., transfers ownership without justifiable grounds, such as death, divorce, emigration, cancellation of a driving license, or grounds similar thereto, or establishes a branch family within one year from the date of registration of a motor vehicle, the exempted portion of acquisition tax shall be collected as a penalty: Provided, That this shall not apply where the ownership of a person eligible to be jointly registered with a person who has rendered distinguished service to the State, etc., has been transferred to the person who has rendered distinguished service to the State, etc.; where a person eligible to be jointly registered with a person who has rendered distinguished service to the State, etc., has obtained a share of the ownership of the person who has rendered distinguished service to the State, etc.; or where the registration of ownership has been exchanged between persons eligible to be jointly registered. <Newly Inserted by Act No. 13637, Dec. 29, 2015>
 Article 30 (Reduction or Exemption for the Korea Veterans Health Service, etc.)
(1) Acquisition tax shall be reduced by 25/100 on real estate acquired by the Korea Veterans Health Service established pursuant to the Korea Veterans Health Service Act, to use directly for projects prescribed in subparagraphs 2 through 9 of Article 6 of the same Act; and property tax shall be reduced by 25/100 on real estate used directly for the relevant projects as at the tax base date, until December 31, 2019, respectively. <Amended by Act No. 11618, Jan. 1, 2013; Act No. 12175, Jan. 1, 2014; Act No. 13637, Dec. 29, 2015; Act No. 14477, Dec. 27, 2016>
(2) Acquisition tax on real estate acquired by veterans hospitals prescribed in Article 7 (1) of the Korea Veterans Health Service Act, to use directly for medical profession; and property tax (including an amount imposed pursuant to Article 112 of the Local Tax Act) on real estate used directly for the relevant business as at the tax base date shall be reduced by 100/100 until December 31, 2016 (or 75/100, from January 1, 2017 to December 31, 2018), respectively. <Amended by Act No. 13637, Dec. 29, 2015>
(3) Acquisition tax on real estate acquired by the Independence Hall of Korea established pursuant to the Independence Hall of Korea Act, to use directly for the duties prescribed in Article 6 (1) of the same Act; property tax (including an amount imposed pursuant to Article 112 of the Local Tax Act) on real estate (excluding the portion used for any other purpose where the relevant real estate is used for any other purpose simultaneously) used directly for the relevant duties as at the tax base date; and the pro rata property portion of resident tax on the relevant corporation, shall be exempted, until December 31, 2018, respectively. <Amended by Act No. 11618, Jan. 1, 2013; Act No. 13637, Dec. 29, 2015>
 Article 31 (Reduction or Exemption for Rental Housing, etc.)
(1) Where a public housing unit business operator under the Special Act on Public Housing or a rental business operator under the Special Act on Private Rental Housing (referring to where a person is registered as a rental business operator with the relevant real estate for rent as the object of rent within 60 days from the date of acquisition of real estate for rent; hereafter in this Article, referred to as "rental business operator"), constructs multi-family housing (including facilities appurtenant to such multi-family housing and welfare facilities for rent, the total amount of rental income from which is appropriated to cover management expenses for houses for rent; hereafter in this Article, the same shall apply) for rental purposes, if the multi-family housing or officetel (including appertinent land; hereafter in this Article, referred to as "officetel") among the quasi-housing referred to in subparagraph 1 of Article 2 of the Special Act on Private Rental Housing, are purchased in parcels for rental purposes by a rental business operator, who becomes the first purchaser of the relevant parcels of multi-family housing or officetel, from the building owner for rent, local tax on such multi-family housing or officetel shall be reduced until December 31, 2018, as follows: Provided, That where the construction of multi-family housing does not commence without just grounds, within two years from the date of acquisition of land, such cases shall be excluded: <Amended by Act No. 11138, Dec. 31, 2011; Act No. 11397, Mar. 21, 2012; Act No. 11618, Jan. 1, 2013; Act No. 13435, Jul. 24, 2015; Act No. 13499, Aug. 28, 2015; Act No. 13637, Dec. 29, 2015; Act No. 14477, Dec. 27, 2016>
1. Where a unit of multi-family housing or officetel with an area for exclusive use by its occupants, not exceeding 60 square meters, is acquired, acquisition tax shall be exempted;
2. Where at least 20 units of housing for lease (hereafter in this Article, referred to as "house for long-term lease") with an area for exclusive use by its occupant of between 60 and 85 square meters, are acquired for lease for at least eight years under the Special Act on Private Rental Housing or the Special Act on Public Housing, or a rental business operator who holds at least 20 units of housing for long-term lease, additionally acquires houses for long-term lease (where he/she becomes a holder of at least 20 units of housing for long-term lease through additional acquisition, including the excess units of housing beginning from the 20th unit), acquisition tax shall be reduced by 50/100.
(2) For the purposes of paragraph (1), where a house is used other than for lease, or is sold or donated for a reason other than that prescribed by Presidential Decree, during the obligatory lease period prescribed in Article 43 (1) of the Special Act on Private Rental Housing or Article 50-2 (1) of the Special Act on Public Housing, the reduced or exempted portion of acquisition tax shall be collected as a penalty. <Amended by Act No. 10417, Dec. 27, 2010; Act No. 13499, Aug. 28, 2015>
(3) Where a rental business operator, etc. prescribed by Presidential Decree builds or purchases multi-family housing for lease or purchases officetels in Korea, and uses at least two units thereof directly for lease as at the tax base date, property tax shall be reduced until December 31, 2018, as follows: <Amended by Act No. 10417, Dec. 27, 2010; Act No. 11397, Mar. 21, 2012; Act No. 11618, Jan. 1, 2013; Act No. 13499, Aug. 28, 2015; Act No. 13637, Dec. 29, 2015; Act No. 15295, Dec. 26, 2017>
1. Property tax (including an amount imposed pursuant to Article 112 of the Local Tax Act) and local resource and facility tax prescribed in Article 146 (2) of the Local Tax Act, shall be exempted, respectively, on multi-family housing for lease for at least 30 years, with an area for exclusive use by its occupants, not exceeding 40 square meters, prescribed in Article 50-2 (1) of the Special Act on Public Housing;
2. Property tax (including an amount imposed pursuant to Article 112 of the Local Tax Act) shall be reduced by 50/100; and local resource and facility tax prescribed in Article 146 (2) of the Local Tax Act, shall be exempted, on multi-family housing or officetel for lease with an area for exclusive use by its occupants, not exceeding 60 square meters;
3. Property tax shall be reduced by 25/100 on multi-family housing or officetel for lease with an area for exclusive use by its occupants, not exceeding 85 square meters.
(4) Acquisition tax and property tax shall be reduced by 50/100 until December 31, 2018, respectively, on a house prescribed by Presidential Decree, which have been purchased and supplied pursuant to Article 43 (1) of the Special Act on Public Housing by the Korea Land and Housing Corporation incorporated pursuant to the Korea Land and Housing Corporation Act (hereinafter referred to as the "Korea Land and Housing Corporation"): Provided, That the reduced portion of acquisition tax and property tax shall be collected as a penalty in any of the following cases: <Amended by Act No. 10417, Dec. 27, 2010; Act No. 11138, Dec. 31, 2011; Act No. 11618, Jan. 1, 2013; Act No. 12251, Jan. 14, 2014; Act No. 12955, Dec. 31, 2014; Act No. 13498, Aug. 28, 2015; Act No. 13637, Dec. 29, 2015; Act No. 14477, Dec. 27, 2016>
1. Where such house is not used directly for the relevant purposes without just grounds, within one year from the date of purchase;
2. Where such house is sold, donated, or used for any other purpose, after having been used directly for the relevant purposes for less than two years.
(5) Deleted. <by Act No. 11138, Dec. 31, 2011>
 Article 31-2 (Reduction or Exemption for Unsold Housing Units after Completion of Construction)
(1) Where a house meeting each of the following requirements sold by a business entity prescribed in Article 54 (1) of the Housing Act (hereafter in this Article, referred to as "unsold housing unit after completion of construction"), is acquired by a first-time buyer by not later than December 31, 2016, acquisition tax shall be reduced by 25/100: <Amended by Act No. 13637, Dec. 29, 2015; Act No. 13805, Jan. 19, 2016>
1. That it is not sold even after inspection of use or approval for temporary use under Article 49 of the Housing Act or Article 22 of the Building Act, was obtained;
2. That the price announced in the invitation to occupants prescribed in the Housing Act does not exceed 600 million won, and the area for exclusive use by its occupant does not exceed 149 square meters and no one has lived therein (including a residential building and appurtenant land);
3. That a lease contract is concluded by no later than December 31, 2011, and it has been leased for at least two years.
(2) Acquisition tax shall be reduced by 25/100 on an unsold housing unit after completion of construction meeting the requirements under paragraph (1) 1 and 2 acquired by no later than December 31, 2011, for lease for at least five years: Provided, That where such housing unit is sold, donated, or used for any other purpose without just grounds, after having been leased for less than five years, the reduced or exempted portion of acquisition tax shall be collected as a penalty. <Amended by Act No. 11138, Dec. 31, 2011>
(3) For the purposes of paragraph (1) or (2), procedures, methods, etc. for confirming an unsold housing unit after completion of construction, leasing period, etc., shall be determined by the Minister of the Interior and Safety. <Amended by Act No. 11690, Mar. 23, 2013; Act No. 12844, Nov. 19, 2014; Act No. 13637, Dec. 29, 2015; Act No. 14839, Jul. 26, 2017>
(4) Notwithstanding the requirements prescribed in paragraph (1) 2, a local government may additionally reduce acquisition tax on an unsold housing unit after completion of construction, by up to 25/100, including where it prescribes by municipal ordinance a different selling price and area for exclusive use by its occupants according to the trend of the housing market of the relevant area, financial conditions, etc. In such cases, where the requirements for selling price and area for exclusive use by its occupant do not fall under the requirements prescribed in paragraph (1) 2, the reduction rate prescribed in paragraph (1) or (2) shall be deemed not granted.
(5) Where a local government prescribes local tax reduction by municipal ordinance pursuant to paragraph (4), Article 4 (1) (main sentence), (3) (latter part), (6), and (7) shall not apply.
[This Article Newly Inserted by Act No. 10470, Mar. 29, 2011]
 Article 31-3 (Reduction or Exemption for Quasi-Public Rental Housing, etc.)
(1) Where a person who intends to rent commercial rental housing defined in subparagraph 4 of Article 2 of the Special Act on Private Rental Housing or quasi-public rental housing defined in subparagraph 5 of the same Article, builds or purchases at least two households of multi-family housing or officetels referred to in subparagraph 1 of Article 2 of the Special Act on Private Rental Housing (hereafter in this Article, referred to as "officetel") in Korea; and uses them for rental purposes as at the tax base date, he/she shall be granted a reduction or exemption of local taxes until December 31, 2018, as follows: <Amended by Act No. 12686, May 28, 2014; Act No. 13499, Aug. 28, 2015; Act No. 13637, Dec. 29, 2015>
1. In cases of multi-family housing or an officetel for rental purposes with an area for exclusive use not exceeding 40 square meters, property tax (including an amount imposed pursuant to Article 112 of the Local Tax Act) and local resource and facility tax prescribed in Article 146 (2) of the Local Tax Act, shall be exempted, respectively;
2. In cases of multi-family housing or an officetel for rental purposes with an area for exclusive use of between 40 and 60 square meters, property tax (including an amount imposed pursuant to Article 112 of the Local Tax Act), shall be reduced by 75/100; and local resource and facility tax prescribed in Article 146 (2) of the Local Tax Act, shall be exempted;
3. In cases of multi-family housing or an officetel for rental purposes with an area for exclusive use of between 60 and 85 square meters, property tax shall be reduced by 50/100.
(2) For the purposes of paragraph (1) 1, if the registration of a rental business operator of quasi-public rental housing is cancelled pursuant to Article 6 of the Special Act on Private Rental Housing, the reduced or exempted portion of property tax for a period within five years retrospectively from the extinction date of the ground for reduction or exemption thereof, shall be collected as a penalty: Provided, That if the registration of the business operator is cancelled after lapse of the mandatory leasing period prescribed in Article 43 (1) of the Special Act on Private Rental Housing or due to a ground referred to in Article 43 (2) or (4) of the same Act (a sale between rental business operators shall not be deemed a ground for exclusion from penalty tax), such case shall be excluded from penalty tax. <Amended by Act No. 13499, Aug. 28, 2015; Act No. 13637, Dec. 29, 2015; Act No. 14477, Dec. 27, 2016>
[This Article Newly Inserted by Act No. 11999, Aug. 6, 2013]
 Article 31-4 (Reduction or Exemption for Real Estate Investment Companies Investing in Housing Lease Business)
(1) Acquisition tax shall be reduced by 30/100 until December 31, 2018, on real estate acquired for lease (limited to real estate acquired to build or purchase multi-family housing defined in subparagraph 3 of Article 2 of the Housing Act (including officetels among quasi-housing defined in subparagraph 4 of Article 2 of the same Act; hereafter in this Article, the same shall apply) by an entrusted management real estate investment trust defined in subparagraph 1 (b) of Article 2 of the Real Estate Investment Company Act (where the State, local governments, Korea Land and Housing Corporation, or local corporations have invested, whether solely or jointly, in all stocks issued by the relevant real estate investment company, referring to where the ratio of the stocks held thereby exceeds 50/100). In such cases, the tax rates prescribed in the main sentence of Article 13 (2) and (3) of the Local Tax Act, shall not apply. <Amended by Act No. 13637, Dec. 29, 2015; Act No. 13805, Jan. 19, 2016; Act No. 14477, Dec. 27, 2016>
(2) Where a real estate investment company prescribed in paragraph (1) directly uses at least two units of multi-family housing for lease in Korea as at the tax base date, local taxes shall be reduced or exempted until December 31, 2018, as follows: <Amended by Act No. 13637, Dec. 29, 2015>
1. Property tax (including an amount imposed pursuant to Article 112 of the Local Tax Act), shall be reduced by 50/100; and local resource and facility tax prescribed in Article 146 (2) of the Local Tax Act, shall be exempted, on a unit of multi-family housing for lease with an area for exclusive use by its occupants, not exceeding 60 square meters;
2. Property tax shall be reduced by 25/100 on a unit of multi-family housing for lease with an area for exclusive use by its occupants, not exceeding 85 square meters.
(3) For the purposes of paragraph (1), the reduced portion of acquisition tax shall be collected as a penalty in any of the following cases:
1. Where the construction does not commence without just grounds, within two years from the date of acquisition of land;
2. Where the relevant real estate has not been used directly for the relevant purpose without just grounds, within one year from the date of purchase;
3. Where the real estate has been sold, donated, or used for any other purpose, after having been used directly for the relevant purpose for less than two years.
[This Article Newly Inserted by Act No. 12955, Dec. 31, 2014]
 Article 32 (Reduction, Exemption, etc. for Acquisition of Small-Scale Multi-Family Housing by the Korea Land and Housing Corporation)
(1) Acquisition tax and property tax shall be reduced by 50/100 until December 31, 2018, respectively, on real estate for small-scale multi-family housing prescribed by Presidential Decree, which is owned by the Korea Land and Housing Corporation after acquisition for lease (hereafter in this Article, referred to as "small-scale multi-family housing"). <Amended by Act No. 11618, Jan. 1, 2013; Act No. 12955, Dec. 31, 2014; Act No. 13637, Dec. 29, 2015; Act No. 14477, Dec. 27, 2016>
(2) Acquisition tax shall be reduced by 25/100 until December 31, 2016, on real estate for small-scale multi-family housing acquired by the Korea Land and Housing Corporation for sale in lots. <Amended by Act No. 11618, Jan. 1, 2013; Act No. 12955, Dec. 31, 2014>
(3) For the purposes of paragraph (1) or (2), where the construction of small-scale multi-family housing does not commence within the period prescribed by Presidential Decree after acquisition of land or where such land is used for other than that of small-scale multi-family housing, the reduced or exempted portion of acquisition tax and property tax shall be collected as a penalty. <Amended by Act No. 13637, Dec. 29, 2015>
 Article 32-2 (Reduction or Exemption for Resuming Projects for Neglected Buildings by the Korea Land and Housing Corporation)
Acquisition tax shall be reduced by 35/100 on real estate acquired by the Korea Land and Housing Corporation to resume construction in accordance with a plan for the maintenance of buildings neglected for a long period after discontinuance of construction referred to in Article 6 of the Act on Special Measures for the Maintenance, etc. of Buildings Neglected for Long Period after Discontinuance of Construction (limited to where the income received upon completing construction of buildings is to be credited to the fund for the maintenance of buildings neglected for a long period after discontinuance of construction referred to in Article 13 of the same Act); and property tax shall be reduced by 25/100 on real estate used directly for such projects as at the tax base date, until December 31, 2018, respectively.
[This Article Newly Inserted by Act No. 13637, Dec. 29, 2015]
 Article 33 (Reduction or Exemption for Increase in Supply of Houses)
(1) The multi-family housing (including facilities appurtenant to the relevant multi-family housing and welfare facilities thereof, but excluding welfare facilities sold in lots or leased; hereafter in this Article, the same shall apply) of at least five households with an area for exclusive use by the occupants of each unit, not exceeding 60 square meters (excluding land appurtenant to the relevant multi-family housing; hereafter in this paragraph, the same shall apply) built to sell in lots by a housing construction proprietor prescribed by Presidential Decree and the multi-family housing which has been changed to houses for lease under Article 31 due to a reason, such as remaining unsold after construction, shall be exempted from acquisition tax until December 31, 2014. <Amended by Act No. 11618, Jan. 1, 2013; Act No. 12175, Jan. 1, 2014>
(2) Where one becomes qualified as one household owning only one house by acquiring (excluding acquisition due to succession and original acquisition) a house for the low income bracket prescribed by Presidential Decree (including where one becomes qualified as one household owning only one house by selling previous houses for a reason other than donation, within 60 days from the date he/she acquires the relevant house), such house shall be exempted from acquisition tax until December 31, 2018. <Amended by Act No. 10417, Dec. 27, 2010; Act No. 11618, Jan. 1, 2013; Act No. 13637, Dec. 29, 2015>
 Article 34 (Reduction or Exemption for Guarantee, etc. for Sale of Houses by the Korea Housing and Urban Guarantee Corporation)
(1) Acquisition tax shall be reduced by 50/100 until December 31, 2016, on houses acquired by the Korea Housing and Urban Guarantee Corporation prescribed by the Housing and Urban Fund Act (hereinafter referred to as the "Korea Housing and Urban Guarantee Corporation") to guarantee the sale of houses prescribed in Article 26 (1) 2 of the same Act, contracted for sale. <Amended by Act No. 11618, Jan. 1, 2013; Act No. 12989, Jan. 6, 2015; Act No. 13637, Dec. 29, 2015; Act No. 14477, Dec. 27, 2016>
(2) and (3) Deleted. <by Act No. 12175, Jan. 1, 2014>
(4) A real estate investment company shall be exempted from acquisition tax on a house which the real estate investment company defined in subparagraph 1 (a) and (b) of Article 2 of the Real Estate Investment Company Act (hereafter in this Article, referred to as "real estate investment company"), acquires for lease until December 31, 2014; and property tax on the house which the real estate investment company acquires shall be imposed at 1/1,000 until December 31, 2014, notwithstanding the tax rate referred to in Article 111 (1) 3 (b) of the Local Tax Act: Provided, That where the real estate investment company fails to comply with, or violates, any of the terms and conditions of a contract prescribed in paragraph (5) without just grounds, after it has been granted an acquisition tax exemption or a property tax reduction, the reduced or exempted portion of acquisition tax and property tax shall be collected as a penalty. <Newly Inserted by Act No. 11762, May 10, 2013>
(5) Where a real estate investment company seeks to be granted an acquisition tax exemption or a property tax reduction pursuant to paragraph (4), the real estate investment company shall enter into each of the following contracts: <Newly Inserted by Act No. 11762, May 10, 2013>
1. A contract by and between the real estate investment company and a lessee:
(a) A contract under which the real estate investment company leases a house to a lessee of the relevant house (hereafter in this Article, referred to as "lessee") by purchasing the house (including where it purchases a share in the ownership of the house) of a person who owns one house per household (referring to a household which consists of the head of household and its members (limited to a spouse, lineal ascendant, or lineal descendant) stated on a resident registration card for each household as at the date of acquisition of the house), the area for exclusive use of which does not exceed 85 square meters, for a period of at least five years;
(b) A contract under which a lessee is granted a right to repurchase the relevant house (including where the lessee repurchases the house even before the expiration of the period of lease) on a preferential basis after the expiration of the period of lease prescribed in item (a);
2. A contract by and between the real estate investment company and the Korea Land and Housing Corporation: A contract prescribed in the terms and conditions on which the Korea Land and Housing Corporation covenants to purchase a house where a lessee fails to exercise a right to purchase the relevant house on a preferential basis prescribed in subparagraph 1 (b).
(6) Deleted. <by Act No. 12175, Jan. 1, 2014>
(7) Acquisition tax shall be reduced by 50/100 on unsold housing units and appurtenant land (hereafter in this paragraph, referred to as "unsold housing units, etc.") directly acquired by a corporate restructuring real estate investment company defined in subparagraph 1 (c) of Article 2 of the Real Estate Investment Company Act or a real estate fund defined in subparagraph 2 of Article 229 of the Financial Investment Services and Capital Markets Act (including specialized investment-type privately placed funds referred to in Article 9 (19) 2 of the same Act which invest in real estate prescribed in subparagraph 2 of Article 229 of the same Act in excess of 80/100 of the syndicate property; hereinafter the same shall apply) from project undertakers prescribed in the Housing Act by December 31, 2016; and property tax on unsold housing units, etc. acquired, shall be imposed at the rate of 1/1,000 until December 31, 2016, notwithstanding the tax rate referred to in Article 111 (1) 3 (b) of the Local Tax Act. <Newly Inserted by Act No. 12175, Jan. 1, 2014; Act No. 13637, Dec. 29, 2015>
 Article 35 (Reduction or Exemption for Houses subject to Reverse Mortgage)
(1) To guarantee a reverse mortgage pursuant to the Korea Housing Finance Corporation Act, if the Korea Housing Finance Corporation incorporated pursuant to the same Act or a finance company that pays a reverse mortgage pursuant to the same Act obtains any registration of a house provided as security (referring to a house prescribed in subparagraph 3 of Article 104 of the Local Tax Act; hereafter in this Article, the same shall apply) that meets the standards for security of a reverse mortgage deliberated and resolved on by a housing finance operations committee established under Article 9 (1) of the same Act, under Article 9 (2) 5 of the same Act, registration license tax on such house provided as security shall be reduced by 100/100 until December 31, 2017 (or 75/100 from January 1, 2018 to December 31, 2019): Provided, That this shall be limited to where the person who provides a house as security, assumes the registration license tax. <Amended by Act No. 11618, Jan. 1, 2013; Act No. 13637, Dec. 29, 2015>
(2) Property tax on a house provided as security for a reverse mortgage under paragraph (1) shall be reduced or exempted until December 31, 2018, as follows: <Amended by Act No. 11618, Jan. 1, 2013; Act No. 13637, Dec. 29, 2015>
1. In cases of a house with an officially announced price under Article 4 (1) of the Local Tax Act or the price assessed by the head of a Si/Gun (hereafter in this Article, referred to as "officially announced price, etc. of a house") not exceeding 500 million, property tax shall be reduced by 25/100;
2. Where the officially announced price, etc. of a house exceeds 500 million won in value, 25/100 of the amount of property tax on a house with an officially announced price, etc. valued at 500 million won in the relevant year, shall be deducted.
(3) Property tax on a housing unit provided as security by a person who acquires a reverse mortgage loan to be paid money for living, etc. by means of pension from a financial institution under subparagraph 11 of Article 2 of the Korea Housing Finance Corporation Act, shall be reduced until December 31, 2018, as follows: <Newly Inserted by Act No. 11618, Jan. 1, 2013; Act No. 13637, Dec. 29, 2015>
1. In cases of a housing unit with an officially announced price, etc. not exceeding 500 million won, property tax shall be reduced by 25/100;
2. In cases of a housing unit with an officially announced price, etc. exceeding 500 million won, 25/100 of the amount of property tax on a housing unit with an officially announced price, etc. valued at 500 million won in the relevant year, shall be reduced.
 Article 35-2 (Reduction or Exemption on Farmland Eligible for Stabilization Fund for Old Life of Farmers)
Property tax on farmland provided as security to be provided with a stabilization fund for old life under Article 24-5 of the Korea Rural Community Corporation and Farmland Management Fund Act, shall be reduced until December 31, 2018, as follows: <Amended by Act No. 13637, Dec. 29, 2015>
1. In cases of farmland with an officially announced price under Article 4 (1) of the Local Tax Act or the price calculated by the head of a Si/Gun (hereafter in this Article, referred to as "officially announced land price, etc.") not exceeding 600 million won, such farmland shall be exempted from property tax;
2. Where the officially announced land price, etc. exceeds 600 million won, 100/100 of the amount of property tax on farmland with an officially announced price, etc. valued at 600 million won in the relevant year, shall be deducted.
[This Article Newly Inserted by Act No. 11618, Jan. 1, 2013]
 Article 35-3 (Deduction of Amount of Property Tax on Housing with Housing Mortgage Loan for Lessee's Preparation of Funds for Lease on Deposit Basis)
(1) Where a person who owns a housing unit being used as a rental housing unit as at the tax base date of property tax after a rental contract has been concluded between the lessor and the lessee, fulfills each of the following requirements, the amount of tax calculated by applying 1/1,000 to 60/100 of the amount of housing mortgage loan, shall be deducted until December 31, 2016, from the amount of property tax calculated by applying the tax rate prescribed in Article 111 (1) 3 (b) of the Local Tax Act: Provided, That if any of the following requirements is violated during the relevant period of lease, the portion of property tax so deducted shall be collected as a penalty: <Amended by Act No. 13637, Dec. 29, 2015>
1. Where the lessee is a non-home-owning householder as at the contract date and his/her annual income for the immediately preceding year (including his/her spouse's income) does not exceed 60 million;
2. Where the deposit for leasing housing on a deposit basis does not exceed 200 million won (or 300 million won in cases of the Seoul Metropolitan area);
3. Where the amount of housing mortgage loan does not exceed 30 million won (or 50 million won in cases of the Seoul Metropolitan area);
4. Where a contract for housing mortgage loan is concluded with a finance company, etc. defined in subparagraph 1 of Article 2 of the Act on Real Name Financial Transactions and Confidentiality (hereafter in this Article, referred to as "finance company, etc.") in accordance with the rental contract form prescribed by the Minister of Land, Infrastructure, and Transport, on condition that the deposit for lease on a deposit basis prescribed in subparagraph 2, be fully or partially funded by the lessor through a housing mortgage loan and the interest thereon shall be borne by the lessee;
5. Where a housing mortgage loan handled by a finance company, etc. is provided through a bankbook indicating a loan for lease on a deposit basis.
(2) Where an amount of property tax is deducted pursuant to paragraph (1), the portion relevant to the ratio of amount of tax deducted in the amount of property tax calculated (if the ratio calculated as a percentage contains any fraction below the decimal point, such fractions of a value shall be rounded down to the nearest whole number), shall be deemed the reduction rate of property tax.
(3) For the purposes of paragraph (1), the criteria prescribed by the Minister of the Interior and Safety prescribed in Article 36-2 (4) shall apply mutatis mutandis to methods for verifying a non-home-owning householder and his/her income during the immediately preceding year. <Amended by Act No. 12844, Nov. 19, 2014; Act No. 14839, Jul. 26, 2017>
[This Article Newly Inserted by Act No. 11999, Aug. 6, 2013]
 Article 36 (Reduction or Exemption for Assistance to Supply of Houses to Persons without House)
Real estate for the construction of houses acquired by a corporation prescribed by Presidential Decree, which is a public interest corporation incorporated pursuant to the Act on the Establishment and Operation of Public Interest Corporations, to supply houses to persons without a house, shall be exempted from acquisition tax; and real estate used directly for such duties as at the tax base date, shall be exempted from property tax (including an amount imposed pursuant to Article 112 of the Local Tax Act) until December 31, 2018, respectively: Provided, That where the construction of houses does not commence within two years from the date of acquisition without just grounds, or such real estate is used for any other purpose, the exempted portion of acquisition tax shall be collected as a penalty. <Amended by Act No. 11618, Jan. 1, 2013; Act No. 13637, Dec. 29, 2015>
 Article 36-2 Deleted. <by Act No. 12955, Dec. 31, 2014>
 Article 37 (Reduction or Exemption for Public Medical Institutions)
Acquisition tax on real estate acquired by any of the following corporations to use directly for its unique duties, shall be reduced by 100/100 until December 31, 2016 (or 75/100, from January 1, 2017 to December 31, 2018); and property tax (including an amount imposed pursuant to Article 112 of the Local Tax Act) on real estate used directly for its own duties as at the tax base date, shall be reduced by 100/100 until December 31, 2016 (or 75/100, from January 1, 2017 to December 31, 2018), respectively: <Amended by Act No. 10333, May 31, 2010; Act No. 10417, Dec. 27, 2010; Act No. 11618, Jan. 1, 2013; Act No. 12175, Jan. 1, 2014; Act No. 12955, Dec. 31, 2014>
1. Seoul National University Hospital established pursuant to the Establishment of Seoul National University Hospital Act;
2. Seoul National Dental Hospital established pursuant to the Establishment of Seoul National University Dental Hospital Act;
3. National university-affiliated hospitals established pursuant to the Act on the Establishment of National University-Affiliated Hospitals;
4. National Cancer Center established pursuant to the Cancer Control Act;
5. National Medical Center established pursuant to the Act on Establishing and Administrating the National Medical Center;
6. National university-affiliated dental hospitals established pursuant to the Act on the Establishment of National University-Affiliated Dental Hospitals.
 Article 38 (Special Taxation for Medical Institutions, etc.)
(1) Acquisition tax on real estate acquired by any medical institution established pursuant to Article 48 of the Medical Service Act, to use directly for medical services, shall be reduced by 75/100 until December 31, 2016 (or 50/100, from January 1, 2017 to December 31, 2018) (in cases of real estate acquired in the Special Metropolitan City, a Metropolitan City, or a Si which is the seat of a Do government, referring to the reduction of 15/1,000 from the tax rate prescribed in Article 11 (1) of the Local Tax Act until December 31, 2016) (or 10/1,000 from the tax rate prescribed in Article 11 (1) of the Local Tax Act, from January 1, 2017 to December 31, 2018)); and property tax (including an amount imposed pursuant to Article 112 of the Local Tax Act) on real estate used directly for medical services as at the tax base date, shall be reduced by 75/100 until December 31, 2016 (or 50/100, from January 1, 2017 to December 31, 2018). <Amended by Act No. 11618, Jan. 1, 2013; Act No. 12175, Jan. 1, 2014; Act No. 12955, Dec. 31, 2014>
(2) Hospitals affiliated with medical schools (including herbal medical schools, dentistry schools, and veterinary schools) established pursuant to Article 4 of the Higher Education Act, shall be exempted from the pro rata property portion and the pro rata employee portion of resident tax until December 31, 2014. <Amended by Act No. 11618, Jan. 1, 2013; Act No. 12175, Jan. 1, 2014>
(3) The following local taxes on local medical centers established pursuant to the Act on the Establishment and Management of Local Medical Centers, shall be reduced by 100/100 until December 31, 2016 (or 75/100, from January 1, 2017 to December 31, 2018), respectively: <Newly Inserted by Act No. 11138, Dec. 31, 2011; Act No. 12175, Jan. 1, 2014; Act No. 12955, Dec. 31, 2014>
1. Acquisition tax on real estate acquired to use directly for medical services;
2. Deleted; <by Act No. 12955, Dec. 31, 2014>
3. Property tax (including an amount imposed pursuant to Article 112 of the Local Tax Act) on real estate used directly for medical services as at the tax base date.
(4) Religious organizations (limited to incorporated foundations incorporated pursuant to the Civil Act) shall be exempt from local taxes until December 31, 2018, as follows: <Newly Inserted by Act No. 11138, Dec. 31, 2011; Act No. 11618, Jan. 1, 2013; Act No. 12175, Jan. 1, 2014; Act No. 12955, Dec. 31, 2014>
1. Acquisition tax on real estate acquired to use directly for medical services by establishing a medical institution under the Medical Service Act, shall be reduced, as follows:
(a) Acquisition tax on real estate acquired in the Special Metropolitan City, a Metropolitan City, or a Si which is the seat of a Do government, shall be reduced by up to 20/100 prescribed by municipal ordinance;
(b) Acquisition tax on real estate acquired in an area other than that prescribed in item (a), shall be reduced by up to 40/100 prescribed by municipal ordinance;
2. Property tax (including an amount imposed pursuant to Article 112 of the Local Tax Act) on real estate used directly for medical services as at the tax base date, shall be reduced by up to 75/100 prescribed by municipal ordinance, until December 31, 2016 (or 50/100, from January 1, 2017 to December 31, 2018).
(5) Where at least two Sis and Guns consolidate into a Si which becomes the seat of a Do government, as prescribed in Article 4 (1) of the Local Autonomy Act, notwithstanding paragraphs (1) and (4), the pre-consolidation reduction rate may apply to the previous Sis (excluding the Si which is the seat of a Do government) and Guns by up to five years, from the time the consolidated local government is established, as prescribed by ordinance of the consolidated local government. <Newly Inserted by Act No. 11138, Dec. 31, 2011>
 Article 39 (Reduction or Exemption for Assistance to National Health Insurance Projects)
(1) Local taxes on real estate acquired by the National Health Insurance Corporation under the National Health Insurance Act, to use directly for its unique duties, shall be reduced until December 31, 2014, as follows: <Amended by Act No. 11141, Dec. 21, 2011; Act No. 11618, Jan. 1, 2013>
1. Acquisition tax shall be exempted on real estate acquired by the National Health Insurance Corporation, to use directly for the duties prescribed in Article 14 (1) 1 through 3, 7, and 8 of the National Health Insurance Act; and property tax shall be reduced by 50/100 on real estate used directly for such duties as at the tax base date;
2. Acquisition tax shall be reduced by 50/100 on real estate acquired by the National Health Insurance Corporation to use for duties prescribed in Article 14 (1) 6 of the National Health Insurance Act; and property tax shall be reduced by 50/100 on real estate used directly for such duties as at the tax base date.
(2) Local taxes on real estate acquired by the Health Insurance Review and Assessment Service under the National Health Insurance Act, to use directly for its unique duties, shall be reduced until December 31, 2014, as follows: <Amended by Act No. 11141, Dec. 31, 2011; Act No. 11618, Jan. 1, 2013>
1. Acquisition tax shall be exempted on real estate acquired by the Health Insurance Review and Assessment Service to use directly for the duties prescribed in Article 63 (1) 1 of the National Health Insurance Act; and property tax shall be reduced by 50/100 on real estate used directly for such duties as at the tax base date;
2. Acquisition tax shall be reduced by 50/100 on real estate acquired by the Health Insurance Review and Assessment Service, to use directly for the duties prescribed in Article 63 (1) 2 of the National Health Insurance Act; and property tax shall be reduced by 25/100 on real estate used directly for such duties as at the tax base date.
 Article 40 (Reduction or Exemption for National Health Promotion Service Providers)
Acquisition tax shall be reduced by 75/100 on real estate (excluding rental real estate; hereafter in this Article, the same shall apply) acquired by any of the following corporations to use directly for its unique duties; and property tax (including an amount imposed pursuant to Article 112 of the Local Tax Act) shall be reduced by 75/100 on real estate used directly for such duties as at the tax base date, until December 31, 2018, respectively: <Amended by Act No. 11618, Jan. 1, 2013; Act No. 13637, Dec. 29, 2015; Act No. 14477, Dec. 27, 2016>
1. Korea Population and Health Welfare Association under the Mother and Child Health Act;
2. Korea Association of Health Promotion under the Infectious Disease Control and Prevention Act;
3. Korea National Tuberculosis Association under the Tuberculosis Prevention Act.
 Article 40-2 (Reduction or Exemption of Acquisition Tax on Housing Transactions)
(1) Where a person falls under any of the following due to the acquisition of a house the price of which at the time of acquisition under Article 10 of the Local Tax Act does not exceed 900 million won, by means of a transaction for value from January 1, 2013 to June 30, 2013, acquisition tax calculated by applying the tax rate referred to in Article 11 (1) 7 (b) of the same Act, shall be reduced by 75/100; where a person falls under any of the following due to the acquisition of a house the price of which exceeds 900 million won, but does not exceed 1.2 billion won, or becomes an owner of at least two houses not falling under subparagraph 2 due to the acquisition of a house the price of which does not exceed 1.2 billion won, acquisition tax calculated by applying the tax rate referred to in Article 11 (1) 7 (b) of the same Act, shall be reduced by 50/100; and where a person acquires a house the price of which exceeds 1.2 billion won, acquisition tax calculated by applying the tax rate referred to in Article 11 (1) 7 (b) of the same Act, shall be reduced by 25/100, respectively: Provided, That where he/she fails to reduce his/her holdings to only one house without just grounds within three years from the date of acquisition of a house the price of which does not exceed 900 million won after he/she has acquired such house in the state referred to in subparagraph 2 and has been granted an acquisition tax reduction, one-third of the reduced portion of acquisition tax shall be collected as a penalty:
1. Where he/she reduces his/her holdings to only one house;
2. Where he/she temporarily reduces his/her holdings to two houses prescribed by Presidential Decree.
(2) Where a person falls under any of the following due to the acquisition of a house the price of which at the time of acquisition under Article 10 of the Local Tax Act does not exceed 900 million won, by means of a transaction for value from July 1, 2013 to December 31, 2013, acquisition tax calculated by applying the tax rate referred to in Article 11 (1) 7 (b) of the same Act, shall be reduced by 50/100: Provided, That where he/she fails to reduce his/her holdings to only one house without just grounds within three years from the date of acquisition of a house after he/she has acquired such house in the state referred to in subparagraph 2 and has been granted an acquisition tax reduction, the reduced portion of acquisition tax shall be collected as a penalty:
1. Where he/she reduces his/her holdings to only one house;
2. Where he/she temporarily reduces his/her holdings to two houses prescribed by Presidential Decree.
[This Article Wholly Amended by Act No. 11716, Mar. 23, 2013]
 Article 40-3 (Reduction or Exemption for the Korean Red Cross)
Local tax on real estate (excluding rental real estate) acquired by the Korean Red Cross under the Organization of the Republic of Korea National Red Cross Act, to use directly for its unique duties, shall be reduced, as follows: <Amended by Act No. 14477, Dec. 27, 2016>
1. Acquisition tax shall be reduced by 75/100 on real estate acquired to use directly for medical services among its activities prescribed in subparagraph 4 of Article 7 of the same Act (including nursing services and blood services; hereafter in this Article, referred to as "medical services"); and property tax (including an amount imposed pursuant to Article 112 of the Local Tax Act) shall be reduced by 75/100 on real estate used directly for medical services as at the tax base date, until December 31, 2018, respectively;
2. Acquisition tax shall be reduced by 25/100 on real estate acquired to use directly for services other than medical services referred to in subparagraph 1 (hereafter in this Article, referred to as "nonmedical services"); and property tax shall be reduced by 25/100 on real estate used directly for nonmedical services as at the tax base date, until December 31, 2019, respectively.
[This Article Newly Inserted by Act No. 13637, Dec. 29, 2015]
SECTION 3 Support for Education, Science, Technology, etc.
 Article 41 (Exemption for Schools and Foreign Educational Institutions)
(1) Real estate (excluding dormitories prescribed by Presidential Decree) acquired by a school prescribed in the Elementary and Secondary Education Act or the Higher Education Act, or by a person operating a foreign educational institution prescribed in the Special Act on Establishment and Management of Foreign Educational Institutions in Free Economic Zones and Jeju Free International City or the Special Act on the Development of Enterprise Cities (hereafter in this Article, referred to as "schools, etc."), to use directly for the relevant business, shall be exempted from acquisition tax: Provided, That the exempted portion of acquisition tax shall be collected as a penalty in any of the following cases: <Amended by Act No. 10417, Dec. 27, 2010; Act No. 11138, Dec. 31, 2011; Act No. 11618, Jan. 1, 2013; Act No. 12955, Dec. 31, 2014; Act No. 14477, Dec. 27, 2016; Act No. 15295, Dec. 26, 2017>
1. Where such real estate is used commercially within five years from the date of acquisition;
2. Where it is not used for any of the relevant purposes without just grounds, within three years from the date of acquisition;
3. Where it is sold, donated, or used for any other purpose, after having been used directly for the relevant purposes for less than two years.
(2) Real estate (including land appurtenant to a building prescribed by Presidential Decree) used by schools, etc. directly for the relevant business as at the tax base date, shall be exempted from property tax (including an amount imposed pursuant to Article 112 of the Local Tax Act) and local resource and facility tax prescribed in Article 146 (2) of the Local Tax Act, respectively: Provided, That where such property is used commercially, or a fee is charged for use thereof; or part of such property is not used directly for its original purpose, no such taxes on such property or part thereof, shall be exempted. <Amended by Act No. 11138, Dec. 31, 2011; Act No. 11618, Jan. 1, 2013; Act No. 13637, Dec. 29, 2015>
(3) A license used by a school, etc. directly for its business shall be exempted from registration license tax; and a school, etc. shall be exempted from the pro rata property portion and pro rata employee portion of resident tax, respectively: Provided, That no pro rata property portion and pro rata employee portion of resident tax prescribed by Presidential Decree, shall be exempted when related to profit-making business of a school, etc. <Amended by Act No. 11138, Dec. 31, 2011; Act No. 11618, Jan. 1, 2013; Act No. 12175, Jan. 1, 2014>
(4) Where generated electric power, etc. is supplied to schools, etc. gratuitously, such portion shall be exempted from local resource and facility tax prescribed in Article 146 (1) of the Local Tax Act. <Amended by Act No. 11138, Dec. 31, 2011; Act No. 11618, Jan. 1, 2013; Act No. 13637, Dec. 29, 2015>
(5) An educational foundation prescribed in the Private School Act and a national school established as a national university foundation by the State, shall be exempt from registration license tax on registration for establishment, registration for consolidation, and registration for alteration following the transfer of State-owned property or public property to a national university corporation; and such school shall be exempt from per capita resident tax, respectively. <Amended by Act No. 11138, Dec. 31, 2011; Act No. 11618, Jan. 1, 2013>
(6) Real estate, the donator of which is permitted to use without compensation according to a contract he/she has concluded before the conversion of the national university corporation, which is donated before such conversion, shall be exempted from property tax (including an amount imposed under Article 112 of the Local Tax Act) and local resource and facility tax prescribed in Article 146 (2) of the Local Tax Act, respectively. <Newly Inserted by Act No. 11618, Jan. 1, 2013>
(7) Notwithstanding paragraphs (1) through (6), acquisition tax and property tax imposed on an academic teaching hospital affiliated with a medical school (including an oriental medical school, dental school, and veterinary school) established pursuant to Article 4 of the Higher Education Act, shall be reduced, respectively, as follows: <Newly Inserted by Act No. 11618, Jan. 1, 2013; Act No. 12175, Jan. 1, 2014; Act No. 12955, Dec. 31, 2014>
1. Acquisition tax for the following periods, on real estate acquired to use directly for medical services:
(a) Until December 31, 2016: 75/100;
(b) From January 1, 2017 to December 31, 2018: 50/100;
2. Property tax for the following periods, on real estate used directly for medical services as at the tax base date (including an amount imposed pursuant to Article 112 of the Local Tax Act):
(a) Until December 31, 2016: 75/100;
(b) From January 1, 2017 to December 31, 2018: 50/100.
 Article 42 (Reduction or Exemption for Dormitories, etc.)
(1) Real estate acquired by a school prescribed in the Elementary and Secondary Education Act or the Higher Education Act, or by a person operating a foreign educational institution prescribed in the Special Act on Establishment and Management of Foreign Educational Institutions in Free Economic Zones and Jeju Free International City or the Special Act on the Development of Enterprise Cities (hereafter in this Article, referred to as "schools, etc."), to use for dormitories (limited to dormitories referred to in subparagraphs 4 and 4-2 of Article 19 of the Korea Foundation for the Promotion of Private School Act) prescribed by Presidential Decree, shall be exempted from acquisition tax; real estate used directly for such purpose as at the tax base date, shall be exempted from property tax (including an amount imposed pursuant to Article 112 of the Local Tax Act), and local resource and facility tax prescribed in Article 146 (2) of the Local Tax Act; and the relevant school shall be exempted from the pro rata property portion of resident tax until December 31, 2018, respectively: Provided, That the exempted portion of acquisition tax shall be collected as a penalty in any of the following cases: <Amended by Act No. 10417, Dec. 27, 2010; Act No. 11138, Dec. 31, 2011; Act No. 11618, Jan. 1, 2013; Act No. 12955, Dec. 31, 2014; Act No. 13637, Dec. 29, 2015; Act No. 14477, Dec. 27, 2016>
1. Where it is not used for any of the relevant purposes without just grounds, within three years from the date of acquisition;
2. Where it is sold, donated, or used for any other purpose, after having been used directly for the relevant purposes for less than two years.
(2) Motor vehicles, machinery, aircraft, standing trees, and vessels acquired by a person who has established, and is managing, a school prescribed in Article 11 of the Framework Act on Education to use for experiments and practical training of students, shall be exempted from acquisition tax; and aircraft and vessels used for experiments and practical training of students as at the tax base date, shall be exempted from property tax until December 31, 2018, respectively: Provided, That the exempted portion of acquisition tax shall be collected as a penalty in any of the following cases: <Amended by Act No. 10417, Dec. 27, 2010; Act No. 11138, Dec. 31, 2011; Act No. 11618, Jan. 1, 2013; Act No. 13637, Dec. 29, 2015>
1. Where it is not used for the relevant purposes without just grounds, within one year from the date of acquisition;
2. Where it is sold, donated, or used for any other purpose, after having been used directly for the relevant purposes for less than two years.
(3) Acquisition tax shall be reduced by 75/100 on real estate acquired by an industry-academic cooperation foundation established and managed pursuant to Article 25 of the Industrial Education Enhancement and Industry-Academia-Research Cooperation Promotion Act, to use directly for its unique duties; and property tax shall be reduced by 75/100 on real estate used directly for its unique duties as at the tax base date, until December 31, 2020, respectively. <Amended by Act No. 11618, Jan. 1, 2013; Act No. 12955, Dec. 31, 2014; Act No. 14477, Dec. 27, 2016; Act No. 15295, Dec. 26, 2017>
(4) An industry-academic cooperation foundation prescribed in paragraph (3) shall be exempted from the pro rata property portion and pro rata employee portion of resident tax until December 31, 2014: Provided, That no pro rata property portion and pro rata employee portion of resident tax prescribed by Presidential Decree, shall be exempted when related to profit-making business. <Amended by Act No. 11618, Jan. 1, 2013; Act No. 12175, Jan. 1, 2014>
(5) Deleted. <by Act No. 11138, Dec. 31, 2011>
 Article 43 (Exemption for Lifelong Educational Organizations, etc.)
(1) Acquisition tax shall be exempted until December 31, 2018, on real estate acquired by a lifelong educational organization operating an educational facility under the Lifelong Education Act (hereafter in this Article, referred to as "lifelong educational organization"), to use directly for the relevant business: Provided, That the exempted portion of acquisition tax shall be collected as a penalty in any of the following cases: <Amended by Act No. 10417, Dec. 27, 2010; Act No. 11138, Dec. 31, 2011; Act No. 13637, Dec. 29, 2015; Act No. 14477, Dec. 27, 2016>
1. Where such real estate is used commercially within five years from the date of acquisition;
2. Where such real estate is not used for the relevant purposes without just grounds, within three years from the date of acquisition;
3. Where such real estate is sold, donated, or used for any other purpose, after having been used directly for the relevant purposes for less than two years.
(2) Property tax (including an amount imposed pursuant to Article 112 of the Local Tax Act) and local resource and facility tax prescribed in Article 146 (2) of the Local Tax Act, shall be exempted until December 31, 2018, respectively, on real estate (including land appurtenant to a building prescribed by Presidential Decree) used directly by a lifelong educational organization for the relevant business as at the tax base date: Provided, That where such property is used commercially, or a fee is charged for the use thereof; or part of such property is not used directly for its original purpose, no such taxes on such property or part thereof, shall be exempted. <Amended by Act No. 13637, Dec. 29, 2015>
(3) Registration license tax on a license used by a lifelong educational organization directly for its business, and the pro rata property portion and pro rata employee portion of resident tax on the relevant organization, shall be exempted until December 31, 2018, respectively: Provided, That no pro rata property portion and pro rata employee portion of resident tax prescribed by Presidential Decree, shall be exempted when related to profit-making business. <Amended by Act No. 12175, Jan. 1, 2014; Act No. 13637, Dec. 29, 2015>
(4) Where generated electric power, etc. is supplied to a lifelong educational organization gratuitously, local resource and facility tax prescribed in Article 146 (1) of the Local Tax Act on such portion, shall be exempted until December 31, 2018. <Amended by Act No. 13637, Dec. 29, 2015>
 Article 44 (Reduction or Exemption for Lifelong Educational Facilities, etc.)
Acquisition tax on real estate acquired to use for a lifelong educational facility prescribed by Presidential Decree, and property tax (including an amount imposed pursuant to Article 112 of the Local Tax Act) and local resource and facility tax prescribed in Article 146 (2) of the Local Tax Act on real estate (excluding the portion used for any other purpose, where the relevant facility is used for any other purpose at the same time) used directly for a lifelong educational facility as at the tax base date shall be exempted until December 31, 2018, respectively. <Amended by Act No. 11618, Jan. 1, 2013; Act No. 13637, Dec. 29, 2015>
 Article 44-2 (Reduction or Exemption for Museums, etc.)
Acquisition tax on real estate acquired to use by a museum, art museum, library, or science museum prescribed by Presidential Decree, and property tax (including an amount imposed pursuant to Article 112 of the Local Tax Act) and local resource and facility tax prescribed in Article 146 (2) of the Local Tax Act on real estate (excluding the portion used for any other purpose where the relevant facility is used for any other purpose at the same time) used directly by the relevant museum, art museum, library, or science museum as at the tax base date, shall be exempted until December 31, 2018, respectively.
[This Article Newly Inserted by Act No. 13637, Dec. 29, 2015]
 Article 45 (Reduction or Exemption for Scientific Research Organizations and Scholarship Organizations)
(1) Real estate acquired by a scientific research organization, scholarship organization, or science and technology promotion organization prescribed by Presidential Decree, to use directly for its unique duties, shall be exempted from acquisition tax; and real estate used directly for its unique duties as at the tax base date, shall be exempted from property tax (including an amount imposed pursuant to Article 112 of the Local Tax Act) and local resource and facility tax (applicable only to scientific research organizations and scholarship organizations) prescribed in Article 146 (2) of the Local Tax Act, until December 31, 2019, respectively: Provided, That this shall not apply to organizations referred to in Article 45-2. <Amended by Act No. 11618, Jan. 1, 2013; Act No. 13637, Dec. 29, 2015; Act No. 14477, Dec. 27, 2016; Act No. 15295, Dec. 26, 2017>
(2) Acquisition tax shall be reduced by 80/100 on rental real estate acquired by a scholarship foundation established pursuant to the Act on the Establishment and Operation of Public Interest Corporations, to award scholarships; and property tax (including an amount imposed pursuant to Article 112 of the Local Tax Act) and local resource and facility tax prescribed in Article 146 (2) of the Local Tax Act, shall be reduced by 80/100 on real estate used for rental as at the tax base date, until December 31, 2019, respectively: Provided, That the reduced portion of acquisition tax shall be collected as a penalty in any of the following cases: <Amended by Act No. 10417, Dec. 27, 2010; Act No. 11138, Dec. 31, 2011; Act No. 11618, Jan. 1, 2013; Act No. 13637, Dec. 29, 2015; Act No. 14477, Dec. 27, 2016>
1. Where such real estate is not used for the relevant purposes without just grounds, within three years from the date of acquisition;
2. Where such real estate is sold, donated, or used for any other purpose, after having been used directly for the relevant purpose for less than two years.
 Article 45-2 (Exemption for Research Institutes, etc. for Support of Research on Basic Science)
Acquisition tax on real estate acquired by the Institute for Basic Science under the Special Act on Establishment of and Support for International Science and Business Belt or a research institute under the Act on the Establishment, Operation and Fostering of Government-Funded Science and Technology Research Institutes, Etc., to use directly for its unique duties; and property tax (including an amount imposed pursuant to Article 112 of the Local Tax Act) on real estate used directly for its unique duties as at the tax base date, shall be exempted until December 31, respectively.
[This Article Newly Inserted by Act No. 15295, Dec. 26, 2017]
 Article 46 (Reduction for Support for Promotion of Research and Development)
(1) Acquisition tax shall be reduced by 35/100 on real estate (limited to land appurtenant to an area within seven times the projected horizontal area of the building; hereafter in this Article, the same shall apply) acquired by a research institute affiliated with any enterprise prescribed by Presidential Decree (hereinafter referred to as "research institute affiliated with an enterprise"), to use directly for its original purpose; and property tax shall be reduced by 35/100 on real estate used directly for a research institute affiliated with an enterprise as at the tax base date, until December 31, 2019, respectively. <Amended by Act No. 13637, Dec. 29, 2015; Act No. 14477, Dec. 27, 2016; Act No. 15295, Dec. 26, 2017>
(2) Notwithstanding paragraph (1), acquisition tax shall be reduced by 35/100 on real estate acquired by an enterprise group, etc. subject to limitations on mutual investment prescribed in Article 14 (1) of the Monopoly Regulation and Fair Trade Act, to use directly for a research institute affiliated therewith, to be installed outside an over-concentration limitation zone prescribed in Article 6 (1) 1 of the Seoul Metropolitan Area Readjustment Planning Act; and property tax shall be reduced by 35/100 on real estate used directly for a research institute affiliated therewith as at the tax base date, until December 31, 2019, respectively. <Amended by Act No. 13637, Dec. 29, 2015; Act No. 14477, Dec. 27, 2016>
(3) Notwithstanding paragraph (1), acquisition tax shall be reduced by 60/100 on real estate acquired by a small or medium enterprise defined in Article 2 (1) of the Framework Act on Small and Medium Enterprises (hereafter in this Chapter, referred to as "small or medium enterprise"), to use directly for a research institute affiliated therewith; and property tax shall be reduced by 50/100 on real estate used directly for a research institute affiliated therewith as at the tax base date, until December 31, 2019, respectively. <Amended by Act No. 13637, Dec. 29, 2015; Act No. 14477, Dec. 27, 2016>
(4) For the purposes of paragraphs (1) through (3), where any research institute falls under any of the following cases, the reduced portion of acquisition tax and property tax shall be collected as a penalty: <Amended by Act No. 15295, Dec. 26, 2017>
1. Where it fails to obtain recognition as a research institute affiliated with an enterprise under Article 14-2 of the Basic Research Promotion and Technology Development Support Act within one year (within two years where a new construction, extension, or substantial repair has been conducted) after the acquisition of land or buildings;
2. Where it is closed or used for any other purpose before the lapse of four years after its establishment without just grounds.
[This Article Wholly Amended by Act No. 12955, Dec. 31, 2014]
 Article 47 (Reduction for the Korea Environment Corporation)
Acquisition tax shall be reduced until December 31, 2019, as follows, on real estate (excluding rental real estate; hereafter in this Article, the same shall apply) acquired by the Korea Environment Corporation incorporated pursuant to the Korea Environment Corporation Act, to use directly for projects prescribed in Article 17 (1) of the same Act; and property tax shall be reduced by 25/100 on real estate used directly for its projects as at the tax base date, until December 31, 2019: <Amended by Act No. 13637, Dec. 29, 2015; Act No. 14477, Dec. 27, 2016>
1. Real estate for projects prescribed in Article 17 (1) 2 and 5 of the Korea Environment Corporation Act: 25/100 of acquisition tax;
2. Real estate for projects prescribed in Article 17 (1) 11, 15, and 16 of the Korea Environment Corporation Act: 25/100 of acquisition tax.
[This Article Wholly Amended by Act No. 12955, Dec. 31, 2014]
 Article 47-2 (Reduction for Buildings Certified as Green Architecture)
(1) Acquisition tax on a building (limited to the portion of a building defined in Article 2 (1) 2 of the Building Act; hereafter in this Article, the same shall apply) or house newly built (including expansion or remodeling; hereafter in this Article, the same shall apply) meeting all of the following requirements, shall be reduced by between 3/100 and 10/100 until December 31, 2020, as prescribed by Presidential Decree: <Amended by Act No. 13637, Dec. 29, 2015; Act No. 15295, Dec. 26, 2017>
1. The grade of certification of green architecture prescribed in Article 16 of the Green Buildings Construction Support Act (hereafter in this Article, referred to as "certification of green architecture") shall be at least the criteria prescribed by Presidential Decree;
2. The energy efficiency rating of a building certified under Article 17 of the Green Buildings Construction Support Act (hereafter in this Article, referred to as "energy efficiency rating") shall be at least the criteria prescribed by Presidential Decree.
(2) Acquisition tax on a newly-built building or house which has obtained certification of a zero-energy building pursuant to Article 17 of the Green Buildings Construction Support Act (hereafter in this Article, referred to as "certification of a zero-energy building") shall be reduced by between 15/200 and 20/100 until December 31, 2020, as prescribed by Presidential Decree. <Amended by Act No. 15295, Dec. 26, 2017>
(3) Acquisition tax on a newly-built energy-efficient environmentally-friendly house prescribed by Presidential Decree shall be reduced by 10/100 until December 31, 2020. <Newly Inserted by Act No. 15295, Dec. 26, 2017>
(4) Where certification of green architecture, certification of an energy efficiency rating of a building or house, or certification of a zero-energy building is revoked within three years from the date of acquisition thereof among the buildings or houses for which acquisition tax is reduced under paragraph (1) or (2), the reduced portion of acquisition tax shall be collected as a penalty. <Amended by Act No. 13637, Dec. 29, 2015; Act No. 15295, Dec. 26, 2017>
(5) Property tax on a building or house of at least the criteria prescribed by Presidential Decree, certified as green architecture or certified an energy efficiency rating, shall be reduced by between 3/100 and 15/100 until December 31, 2018 only once, as prescribed by Presidential Decree, for five years from the date of such certification (or the date of construction completion if certified, before the date construction of such building or house is completed): Provided, That this shall not apply where certification of green architecture or certification of an energy efficiency rating has been revoked as at the tax base date. <Amended by Act No. 13637, Dec. 29, 2015; Act No. 15295, Dec. 26, 2017>
(6) For the purposes of paragraph (5), where the date green architecture is certified and the date an energy efficiency rating is certified differ, the period during which reduction is granted shall be calculated based on the earlier of the two dates; and the detailed method for calculating the amount of tax to be reduced shall be prescribed by Presidential Decree. <Amended by Act No. 15295, Dec. 26, 2017>
[This Article Newly Inserted by Act No. 12955, Dec. 31, 2014]
 Article 47-3 (Reduction for Buildings Certified as Using New and Renewable Energy)
(1) Acquisition tax on a newly-built building for business certified as a building using new and renewable energy pursuant to Article 12-2 (1) of the Act on the Promotion of the Development, Use and Diffusion of New and Renewable Energy, shall be reduced by a rate prescribed by Presidential Decree, based upon the rate of supply of new and renewable energy, by between 5/100 and 15/100 of acquisition tax until December 31, 2015.
(2) Where certification of a building using new and renewable energy is revoked within three years from the date of acquisition thereof, among the buildings for which acquisition tax is reduced under paragraph (1), the reduced portion of acquisition tax shall be collected as a penalty.
[This Article Newly Inserted by Act No. 12955, Dec. 31, 2014]
 Article 47-4 (Reduction or Exemption for Buildings or Houses with Aseismatic Capacity)
(1) In cases of a building exempt from examination of its structural safety prescribed in Article 48 (2) of the Building Act or exempt from examination of its structural safety under the Building Act as at the time it was constructed (limited to the portion of a building defined in Article 2 (1) 2 of the Building Act; hereafter in this Article, the same shall apply) or house, with aseismatic capacity verified under Article 16-2 of the Act on the Preparation for Earthquakes and Volcanic Eruptions, local taxes shall be reduced or exempted until December 31, 2018, as follows: Provided, That the same shall not apply to property tax if such building or house is transferred: <Amended by Act No. 13442, Jul. 24, 2015; Act No. 13637, Dec. 29, 2015; Act No. 14477, Dec. 27, 2016>
1. Where any construction works defined in Article 2 (1) 8 of the Building Act are conducted, 50/100 of acquisition tax shall be reduced; and 50/100 of property tax shall be reduced for five years from the date the first liability to pay property tax on such building arises;
2. Where any substantial repair defined in Article 2 (1) 9 of the Building Act is conducted, the relevant building shall be exempted from acquisition tax; and property tax thereon shall be exempted for five years from the date the first liability to pay property tax on such building arises.
(2) Article 47-2 (6) shall apply mutatis mutandis to the method for calculating the amount of property tax to be reduced on a house; Act No. 15295, Dec. 26, 2017>
[This Article Newly Inserted by Act No. 11999, Aug. 6, 2013]
 Article 48 (Reduction or Exemption for National Park Management Projects)
Acquisition tax shall be reduced by 25/100 on real estate (excluding rental real estate; hereafter in this Article, the same shall apply) acquired by the Korea National Park Service under the Korea National Park Service Act, to use directly for park management projects, including installation, maintenance, management, etc. of park facilities; and property tax shall be reduced by 25/100 on real estate used directly for such projects as at the tax base date, until December 31, 2019, respectively. <Amended by Act No. 11618, Jan. 1, 2013; Act No. 13637, Dec. 29, 2015; Act No. 14226, May 29, 2016; Act No. 14477, Dec. 27, 2016>
 Article 49 (Reduction or Exemption for Preventing Marine Pollution, etc.)
Local tax shall be reduced until December 31, 2019, as follows, on real estate (excluding rental real estate; hereafter in this Article, the same shall apply) acquired by the Korea Marine Environment Corporation under the Marine Environment Management Act, to use directly for projects prescribed in Article 97 of the same Act, and on ships acquired to use for preventing marine pollution and for managing the marine environment: <Amended by Act No. 11618, Jan. 1, 2013; Act No. 13637, Dec. 29, 2015; Act No. 14477, Dec. 27, 2016; Act No. 15012, Oct. 31, 2017>
1. Acquisition tax shall be reduced by 25/100 on real estate for projects prescribed in Article 97 (1) 3 (a) and (b) of the Marine Environment Management Act; and property tax shall be reduced by 25/100 on real estate used directly for such projects as at the tax base date;
2. Acquisition tax shall be reduced by 25/100 on real estate for projects prescribed in Article 97 (1) 2 (b) and 6 of the Marine Environment Management Act; and property tax shall be reduced by 25/100 on real estate used directly for such projects as at the tax base date;
3. Acquisition tax and property tax shall be reduced by 25/100, respectively, on ships equipped with marine pollution prevention facilities.
SECTION 4 Support for Culture, Tourism, etc.
 Article 50 (Exemption for Religious Organizations and Confucian Temples)
(1) Acquisition tax shall be exempted on real estate acquired by a religious organization or Confucian temple, to use directly for religious activities or memorial service for ancestors: Provided, That the exempted portion of acquisition tax shall be collected as a penalty in any of the following cases: <Amended by Act No. 10417, Dec. 27, 2010; Act No. 11138, Dec. 31, 2011; Act No. 13637, Dec. 29, 2015; Act No. 14477, Dec. 27, 2016>
1. Where such real estate is used commercially within five years from the date of acquisition;
2. Where such real estate is not used for the relevant purposes without just grounds, within three years from the date of acquisition;
3. Where such real estate is sold, donated, or used for any other purpose, after having been used directly for the relevant purposes for less than two years.
(2) Property tax (including an amount imposed pursuant to Article 112 of the Local Tax Act) and local resource and facility tax prescribed in Article 146 (2) of the Local Tax Act, shall be exempted, respectively, on real estate (including land appurtenant to a building prescribed by Presidential Decree) used directly by a religious organization or Confucian temple prescribed in paragraph (1), for the relevant business (including where a religious organization or Confucian temple uses a third party's real estate gratuitously for the relevant business) as at the tax base date: Provided, That where such property is used commercially, or a fee is charged for the use thereof; or part of such property is not used directly for its original purpose, no such taxes on such property or part thereof, shall be exempted. <Amended by Act No. 12175, Jan. 1, 2014; Act No. 13637, Dec. 29, 2015>
(3) Registration license tax shall be exempted on a license for a religious organization or Confucian temple prescribed in paragraph (1), to use directly for its business; and the pro rata property portion and pro rata employee portion of resident tax, shall be exempted, respectively, on the relevant organization: Provided, That no pro rata property portion and pro rata employee portion of resident tax prescribed by Presidential Decree, shall be exempted when related to profit-making business. <Amended by Act No. 12175, Jan. 1, 2014; Act No. 13637, Dec. 29, 2015>
(4) Where generated electric power, etc. is supplied gratuitously to a religious organization or Confucian temple, local resource and facility tax prescribed in Article 146 (1) of the Local Tax Act, shall be exempted. <Amended by Act No. 13637, Dec. 29, 2015>
(5) Property tax (including an amount imposed pursuant to Article 112 of the Local Tax Act), shall be exempted on the forest of a temple and on the traditional temple preservation area defined in subparagraph 3 of Article 2 of the Korean Traditional Temples Preservation and Support Act, owned by a traditional temple prescribed in subparagraph 1 of the same Article: Provided, That where such property is used commercially, or a fee is charged for use thereof; or part of such property is not used directly for its original purpose, no such tax on such property or part thereof, shall be exempted. <Amended by Act No. 13637, Dec. 29, 2015; Act No. 15295, Dec. 26, 2017>
(6) Per capita resident tax shall be exempted on churches, catholic churches, Buddhist temples, Buddhist shrines, Confucian temples, etc. in which religious ceremonies are performed, among the places of business of a corporation. <Amended by Act No. 13637, Dec. 29, 2015>
 Article 51 (Reduction or Exemption for Newspaper or Communications Business, etc.)
The pro rata property portion and pro rata employee portion of resident tax on a place of business conducting newspaper or communications business to which the Act on the Promotion of Newspapers, Etc. applies, shall be reduced by 50/100 until December 31, 2018, respectively. <Amended by Act No. 11618, Jan. 1, 2013; Act No. 12175, Jan. 1, 2014; Act No. 13637, Dec. 29, 2015>
 Article 52 (Special Taxation for Support for Culture and Arts)
(1) Real estate acquired by a culture and arts organization prescribed by Presidential Decree (hereafter in this paragraph, referred to as "culture and arts organization") or by a sports promotion organization prescribed by Presidential Decree, to use for its unique duties, shall be exempted from acquisition tax; and real estate used directly for its unique duties as at the tax base date, shall be exempted from property tax (including an amount imposed pursuant to Article 112 of the Local Tax Act) and local resource and facility tax (applicable only to culture and arts organizations) prescribed in Article 146 (2) of the Local Tax Act until December 31, 2019, respectively. <Amended by Act No. 11618, Jan. 1, 2013; Act No. 13637, Dec. 29, 2015; Act No. 14477, Dec. 27, 2016>
(2) Acquisition tax on a library established pursuant to the Libraries Act, shall be imposed at 20/1,000 until December 31, 2019, notwithstanding the tax rate prescribed in Article 11 (1) of the Local Tax Act; and registration license tax on the registration or enrollment of such library, shall be exempted until December 31, 2019: Provided, That the exempted portion of acquisition tax and registration license tax shall be collected as a penalty in any of the following cases: <Amended by Act No. 10417, Dec. 27, 2010; Act No. 11138, Dec. 31, 2011; Act No. 12955, Dec. 31, 2014; Act No. 14477, Dec. 27, 2016>
1. Where such real estate is used commercially within five years from the date of acquisition;
2. Where such real estate is not used for the relevant purposes without just grounds, within one year from the date of acquisition;
3. Where such real estate is sold, donated, or used for any other purpose, after having been used directly for the relevant purposes for less than two years.
 Article 53 (Reduction or Exemption for Social Organizations, etc.)
Real estate (excluding rental real estate; hereafter in this Article, the same shall apply) acquired by a national trust corporation prescribed by the Act on the National Trust of Cultural Heritages and National Environment Assets, to use directly for its unique duties, shall be exempted from acquisition tax; and real estate used directly for its unique duties as at the tax base date, shall be exempted from property tax (including an amount imposed pursuant to Article 112 of the Local Tax Act) and local resource and facility tax prescribed in Article 146 (2) of the Local Tax Act until December 31, 2018, respectively. <Amended by Act No. 11618, Jan. 1, 2013; Act No. 13637, Dec. 29, 2015>
 Article 54 (Special Taxation for Tourist Complexes, etc.)
(1) Acquisition tax on real estate acquired by an implementer of a tourism complex development project prescribed in Article 55 (1) of the Tourism Promotion Act, to implement a tourism complex development project, shall be reduced by 25/100 until December 31, 2019, and a rate of up to 25/100 prescribed by municipal ordinance, in consideration of circumstances such as creating a tourism complex in the relevant area, financial situation, etc., may be further reduced. <Amended by Act No. 11138, Dec. 31, 2011; Act No. 12175, Jan. 1, 2014; Act No. 12955, Dec. 31, 2014; Act No. 14477, Dec. 27, 2016>
(2) Where a person operating hotel business prescribed in the Tourism Promotion Act meets the standards prescribed by Presidential Decree, such as the rate of foreign guests registered at a hotel, property tax on land (limited to where Article 106 (1) 2 of the Local Tax Act applies) and buildings used directly for hotel business prescribed in Article 3 (1) 2 (a) of the Tourism Promotion Act as at the tax base date, shall be reduced by 50/100 (or 25/100 in cases of tourist accommodation businesses, the ratings of which under Article 19 of the Tourism Promotion Act are special 1 or 2) until December 31, 2014. <Amended by Act No. 11138, Dec. 31, 2011; Act No. 12175, Jan. 1, 2014>
(3) No tax rate prescribed in Article 13 (1) through (4) of the Local Tax Act shall apply to real estate acquired to operate hotel business prescribed in Article 3 (1) 2 (a) of the Tourism Promotion Act, when acquisition tax is imposed by no later than December 31, 2014, limited to where a local municipal ordinance provides for the application of the standard tax rate in such real estate, notwithstanding Article 4 (2) 1; and no tax rate prescribed in Article 28 (2) and (3) of the Local Tax Act shall apply to the registration of a corporation (including where capital or amount of investment is increased within five years after the year of incorporation), when registration license tax is imposed by not later than December 31, 2014, limited to where a local municipal ordinance provides for the application of the standard tax rate in such real estate, notwithstanding Article 4 (2) 1: Provided, That the reduced portion of acquisition tax shall be collected as a penalty in any of the following cases: <Amended by Act No. 10417, Dec. 27, 2010; Act No. 11138, Dec. 31, 2011; Act No. 12175, Jan. 1, 2014>
1. Where such real estate is not used for the relevant purposes without just grounds, within three years from the date of acquisition;
2. Where such real estate is sold, donated, or used for any other purpose, after having been used directly for the relevant purposes for less than two years.
(4) Deleted. <by Act No. 12175, Jan. 1, 2014>
(5) Acquisition tax on real estate acquired by the following foundations, enterprises, or project undertakers, to use directly for their unique duties and property tax (including an amount imposed pursuant to Article 112 of the Local Tax Act) on real estate used for their unique duties as at the tax base date, may be reduced or exempted until December 31, 2019, respectively, as prescribed by a local municipal ordinance. In such cases, the rate of reduction or exemption shall be determined at within 50/100 (or 100/100 in cases falling under subparagraph 1): <Amended by Act No. 12175, Jan. 1, 2014; Act No. 13637, Dec. 29, 2015; Act No. 14477, Dec. 27, 2016>
1. The EXPO 2012 Yeosu Organizing Committee established under Article 4 of the Special Act on Assistance to the Expo 2012 Yeosu Korea;
2. Enterprises newly created or the place of business of which is newly established (excluding where the existing place of business is relocated) at a special ocean EXPO zone designated and publicly announced under Article 15 (1) of the Special Act on Assistance to the Expo 2012 Yeosu Korea;
(6) Local tax on the athlete villages referred to in subparagraph 2 (b) of Article 2 of the Special Act on Support for the 2018 PyeongChang Olympic and Paralympic Winter Games, shall be reduced or exempted, as follows: <Newly Inserted by Act No. 13637, Dec. 29, 2015; Act No. 14198, May 29, 2016>
1. Acquisition tax shall be exempted until December 31, 2017, where the athlete villages are acquired by constructing them among facilities directly related to the Games, located in Pyeonchang-gun;
2. Where the facilities referred to in subparagraph 1 fall under Article 13 (5) 1 of the Local Tax Act after the Games, Article 111 (1) 3 (b) of the same Act shall apply until December 31, 2022, notwithstanding Article 111 (1) 3 (a) of the same Act and Article 177 hereof.
 Article 55 (Reduction or Exemption for Cultural Heritage)
(1) Property tax (including an amount imposed pursuant to Article 112 of the Local Tax Act) on land (excluding a historical place the owner uses or profits from) designated as a historical place pursuant to the Cultural Heritage Protection Act, shall be exempted: Provided, That where such property is used commercially, or a fee is charged for use thereof; or part of such property is not used directly for its original purpose, no such tax on such property or part thereof shall be exempted. <Amended by Act No. 13637, Dec. 29, 2015>
(2) Property tax on cultural heritage under the Cultural Heritage Protection Act, shall be reduced or exempted, as follows: <Amended by Act No. 12955, Dec. 31, 2014; Act No. 13248, Mar. 27, 2015; Act No. 13637, Dec. 29, 2015>
1. Property tax (including an amount imposed pursuant to Article 112 of the Local Tax Act; hereafter in this paragraph, the same shall apply) shall be exempted on real estate designated as cultural heritage (excluding national intangible cultural heritage) under Article 2 (2) of the Cultural Heritage Protection Act; and property tax shall be reduced by 50/100 on real estate in a protection area designated pursuant to Article 27 of the same Act. In such cases, the head of a local government may reduce it additionally by up to 50/100 prescribed by municipal ordinance, in consideration of the financial condition, etc. of the relevant protection area;
2. Property tax shall be reduced by 50/100 on cultural heritage registered pursuant to Article 53 (1) of the Cultural Heritage Protection Act and on land appurtenant thereto.
SECTION 5 Support for Corporate Structure, Financial Adjustment, etc.
 Article 56 (Reduction or Exemption for Support for Credit Guarantee of Enterprises)
(1) Acquisition tax shall be reduced by 50/100 until December 31, 2014, on real estate acquired by the Korea Credit Guarantee Fund under the Credit Guarantee Fund Act, to use directly for credit guarantee duties prescribed in Article 23 (1) 2 of the same Act. <Amended by Act No. 11618, Jan. 1, 2013>
(2) Acquisition tax shall be reduced by 50/100 until December 31, 2014, on real estate acquired by the Korea Technology Finance Corporation incorporated pursuant to the Korea Technology Finance Corporation Act, to use directly for credit guarantee duties prescribed in Article 28 (1) 2 and 3 of the same Act. <Amended by Act No. 11618, Jan. 1, 2013; Act No. 14122, Mar. 29, 2016>
(3) Local tax shall be reduced until December 31, 2019, as follows, on a credit guarantee foundation established pursuant to the Regional Credit Guarantee Foundation Act: <Newly Inserted by Act No. 11138, Dec. 31, 2011; Act No. 12175, Jan. 1, 2014; Act No. 13637, Dec. 29, 2015; Act No. 14477, Dec. 27, 2016>
1. Acquisition tax shall be reduced by 50/100 on real estate acquired to use directly for credit guarantee duties under subparagraph 2 of Article 17 of the Regional Credit Guarantee Foundation Act (hereafter in this Article, referred to as "credit guarantee duties");
2. Deleted; <by Act No. 14477, Dec. 27, 2016>
3. Property tax shall be reduced by 50/100 on real estate used directly for credit guarantee duties as at the tax base date.
 Article 57 Deleted. <by Act No. 12955, Dec. 31, 2014>
 Article 57-2 (Reduction or Exemption for Merger, Split-off, etc. of Enterprises)
(1) Property acquired by not later than December 31, 2018 by transfer in the course of a merger prescribed by Presidential Decree as a merger that falls under Article 44 (2) or (3) of the Corporate Tax Act, shall be exempted from acquisition tax calculated under Article 15 (1) of the Local Tax Act; however, if the relevant property falls under the proviso to Article 15 (1) 3 of the Local Tax Act, acquisition tax calculated after deducting the following amounts, shall be exempted: Provided, That the reduced portion of acquisition tax shall be collected as a penalty, where any ground prescribed under Article 44-3 (3) of the Corporate Tax Act arises (excluding cases falling under the proviso to the same paragraph) within three years from the date the merger is registered: <Amended by Act No. 13637, Dec. 29, 2015>
1. In cases of property acquired under Article 13 (1) of the Local Tax Act, an amount calculated by applying 300/100 of the base rate for heavy taxation referred to in the same Article (hereinafter referred to as "base rate for heavy taxation");
2. In cases of property acquired under Article 13 (5) of the Local Tax Act, an amount calculated by applying 500/100 of the base rate for heavy taxation.
(2) Property acquired by transfer in the course of the following mergers of corporations, shall be exempted from acquisition tax until December 31, 2018; and registration license tax on the registration of property acquired by transfer in the course of a merger, within three years from the date of a merger, shall be reduced by 75/100 until December 31, 2018: Provided, That the exempted portion of acquisition tax shall be collected as a penalty, where any ground prescribed under Article 44-3 (3) of the Corporate Tax Act arises (excluding cases falling under the proviso to the same paragraph) within three years from the date the merger is registered: <Amended by Act No. 13637, Dec. 29, 2015; Act No. 14477, Dec. 27, 2016>
1. A merger between cooperatives incorporated under the Agricultural Cooperatives Act, the Fisheries Cooperatives Act, or the Forestry Cooperatives Act;
2. A merger between community credit cooperatives incorporated under the Community Credit Cooperatives Act;
3. A merger between credit unions incorporated under the Credit Unions Act;
4. A merger prescribed by Presidential Decree, similar to that referred to in subparagraphs 1 through 3.
(3) Any of the following property acquired by not later than December 31, 2018, shall be exempted from acquisition tax: <Amended by Act No. 13637, Dec. 29, 2015; Act No. 14477, Dec. 27, 2016>
1. Property invested in kind under the State Property Act;
2. Property acquired in the course of split-off meeting the requirements prescribed under Article 46 (2) of the Corporate Tax Act (referring to Article 47 (1) of the same Act, in cases of physical split-off): Provided, That the exempted portion of acquisition tax shall be collected as a penalty, where any ground prescribed under Article 46-3 (3) of the Corporate Tax Act (referring to Article 47 (3) of the same Act, in cases of physical split-off) arises (excluding cases falling under the proviso to Article 46-3 (3) of the same Act) within three years from the date its split-off is registered;
3. Property acquired in the course of investment in kind under Article 47-2 of the Corporate Tax Act: Provided, That the exempted portion of acquisition tax shall be collected as a penalty, where any ground prescribed under Article 47-2 (3) of the same Act arises (excluding cases falling under the proviso to Article 47-2 (3) of the same Act) within three years from the date of acquisition;
4. Property acquired in the course of asset swaps under Article 50 of the Corporate Tax Act;
5. Property for business acquired by a corporation newly incorporated by or surviving consolidation among small or medium enterprises prescribed in Article 31 of the Restriction of Special Taxation Act: Provided, That the exempted portion of acquisition tax shall be collected as a penalty, where any ground prescribed under paragraph (7) of the same Article arises within five years from the date the property for business is acquired;
6. Property acquired in the course of all-inclusive transfer of assets meeting all the requirements prescribed under Article 37 (1) of the Restriction of Special Taxation Act: Provided, That the exempted portion of acquisition tax shall be collected as a penalty, where any ground prescribed under Article 37 (6) of the same Act arises (excluding cases falling under paragraph (7) of the same Article) within three years from the date of acquisition;
7. Property for business acquired by a public institution prescribed in Article 2 (1) of the Act on the Management of Public Institutions, among corporations incorporated under a special Act, due to organizational restructuring of a company under the Commercial Act because of the amendment or abolition of the relevant special Act.
(4) Fixed assets for business acquired by not later than December 31, 2018 due to investment in kind, transfer, or acquisition of business prescribed in Article 32 of the Restriction of Special Taxation Act, shall be exempted from acquisition tax: Provided, That where the relevant business is closed or the relevant property is disposed of (including lease) within two years from the date of acquisition without just grounds prescribed by Presidential Decree, the exempted portion of acquisition tax shall be collected as a penalty. <Amended by Act No. 13637, Dec. 29, 2015>
(5) In any of the following cases, acquisition tax shall be exempted until December 31, 2018, deeming that an oligopolistic stockholder has acquired the real estate, etc. (referring to real estate, etc. referred to in Article 7 (1) of the Local Tax Act) of the relevant corporation prescribed in Article 7 (5) of the same Act: <Amended by Act No. 13613, Dec. 22, 2015; Act No. 13637, Dec. 29, 2015; Act No. 14477, Dec. 27, 2016>
1. Where stocks or shares are acquired through a third-party acquisition or in accordance with an order to transfer contracts under Article 10 of the Act on the Structural Improvement of the Financial Industry, or from an insolvent financial institution against which a decision to transfer contracts has been made under Article 14 (2) of the same Act;
2. Where a financial institution acquires stocks or shares of a corporation due to conversion of a loan extended to the relevant corporation to an investment;
3. Where a corporation becomes a holding company (including a financial holding company; hereafter in this Article, referred to as "holding company") prescribed in the Monopoly Regulation and Fair Trade Act; or where a holding company acquires stocks of its subsidiary prescribed in the same Act or the Financial Holding Companies Act: Provided, That where the holding company fails to meet any of the requirements for a holding company under the Monopoly Regulation and Fair Trade Act, within three years from the date of its incorporation or conversion, the exempted portion of acquisition tax shall be collected as a penalty;
4. Where the Korea Deposit Insurance Corporation prescribed in Article 3 of the Depositor Protection Act or a finance company authorized to perform liquidation prescribed in Article 36-3 of the same Act, acquires stocks or shares pursuant to Article 36-5 (1) or 38 of the same Act;
5. Where the Korea Asset Management Corporation acquires stocks or shares in the course of converting investment of non-performing loans undertaken pursuant to Article 26 (1) 1 of the Act on the Efficient Disposal of Non-Performing Assets, etc. of Financial Companies and the Establishment of Korea Asset Management Corporation;
6. Where the Agricultural Cooperative Asset Management Corporation under the Act on the Structural Improvement of Agricultural Cooperatives acquires stocks or shares in the course of converting investment of insolvent assets pursuant to subparagraph 3 (c) of Article 30 of the same Act;
7. Where stocks of a wholly-owned subsidiary are acquired in the course of all-inclusive swap or transfer of stocks which meet all the requirements prescribed under Article 38 (1) of the Restriction of Special Taxation Act: Provided, That in cases falling under Article 38 (2) of the same Act (excluding cases falling under Article 38 (3) of the same Act), the exempted portion of acquisition tax shall be collected as a penalty;
8. Where stocks of a corporation listed on a securities market prescribed by Presidential Decree, which is a securities market under Financial Investment Services and Capital Markets Act, are acquired.
(6) Where the National Agricultural Cooperative Federation incorporated under the Agricultural Cooperatives Act (hereafter in this Article, referred to as the "Federation"), restructures its business under the same Act, registration license tax on the registrations classified in subparagraphs 1 and 2, shall be exempted until December 31, 2017; and in cases falling under subparagraph 3, acquisition tax shall be exempted: <Amended by Act No. 14481, Dec. 27, 2016>
1. Where any capital support is provided under Article 3 of the Addenda to the Agricultural Cooperatives Act (Act No. 10522), registration of such capital increase;
2. Where for-profit business is transferred under Article 6 of the Addenda to the Agricultural Cooperative Act (Act No. 10522), any of the following registrations:
(a) Registration to incorporate a for-profit subsidiary split off from the Federation;
(b) Where the capital of the Nonghyup Agribusiness Group incorporated under Article 161-2 of the Agricultural Cooperatives Act is increased in the course of transferring economic business from the Federation (including all-inclusive share swap prescribed in Article 360-2 of the Commercial Act), registration of such capital increase;
3. Property acquired by the Nonghyup Agribusiness Group incorporated under Article 134-2 of the Agricultural Cooperatives Act in the course of transferring economic business from the Federation pursuant to paragraph (3) 3 of this Article.
(7) Where the Korea Development Bank merges with the KDB Financial Group Incorporated and the Korea Finance Corporation incorporated under the Korea Finance Corporation Act pursuant to Article 3 (1) of the Addenda to the Korea Development Bank Act (Act No. 12663), registration license tax on the registration of the relevant capital increase, shall be reduced by 90/100 until December 31, 2015.
(8) Where a domestic corporation promotes restructuring of the enterprise, such as a merger, to resolve excessive supply within the relevant industry and to improve productivity of the relevant corporation, in accordance with an enterprise restructuring plan approved, or the amendment of which is approved, by the head of the competent authority, as prescribed in Article 10 or 12 of the Special Act on the Corporate Revitalization, registration license tax on the registration of the relevant corporation, shall be reduced by 50/100 until December 31, 2018: Provided, That the reduced portion of registration license tax shall be collected as a penalty, where the approval of the enterprise restructuring plan is cancelled pursuant to Article 13 of the same Act. <Newly Inserted by Act No. 13637, Dec. 29, 2015; Act No. 14477, Dec. 27, 2016>
(9) Where the National Federation of Fisheries Cooperatives incorporated under the Fisheries Cooperatives Act (hereafter in this paragraph, referred to as the "Federation"), is split off as prescribed by Presidential Decree, local taxes shall be exempted as follows: <Newly Inserted by Act No. 13637, Dec. 29, 2015>
1. Acquisition tax on property acquired by a subsidiary newly incorporated in the course of the split-off as prescribed by Presidential Decree (hereafter in this paragraph, referred to as the "Suhyup Bank") by the relevant split-off, shall be exempted until December 31, 2016;
2. Registration license tax on registration to incorporate the Suhyup Bank, shall be exempted until December 31, 2016.
[This Article Newly Inserted by Act No. 12955, Dec. 31, 2014]
 Article 57-3 (Reduction or Exemption for Improvement, etc. of Financial Structure of Enterprises)
(1) Any of the following property acquired shall be exempted from acquisition tax until December 31, 2018: <Amended by Act No. 13613, Dec. 22, 2015; Act No. 13637, Dec. 29, 2015>
1. Property that a financial institution defined in subparagraph 1 of Article 2 of the Act on the Structural Improvement of the Financial Industry; the Korea Assets Management Corporation; the Korea Deposit Insurance Corporation; or a finance company authorized to perform liquidation, acquires from an insolvent financial institution in receipt of a determination to take timely corrective measures prescribed in Article 10 (2) of the same Act (limited to an order to transfer a business or contract) or a determination to transfer contracts prescribed in Article 14 (2) of the same Act;
2. Property that a cooperative prescribed in the Agricultural Cooperatives Act, or a mutual finance depositor protection fund or the Agricultural Cooperative Asset Management Corporation prescribed in the Act on the Structural Improvement of Agricultural Cooperatives, acquires from an insolvent cooperative in receipt of a determination to take timely corrective measures prescribed in Article 4 of the same Act (limited to an order to transfer a business or contract) or a determination to transfer contracts prescribed in Article 6 (2) of the same Act;
3. Property that a cooperative prescribed in the Fisheries Cooperatives Act or a mutual finance depositor protection fund prescribed in the Act on the Structural Improvement of Fisheries Cooperatives, acquires from an insolvent cooperative in receipt of a determination to take timely corrective measures prescribed in Article 4 of the same Act (limited to an order to transfer a business or contract) or a determination to transfer contracts prescribed in Article 10 (2) of the same Act;
4. Property that a cooperative prescribed in the Forestry Cooperatives Act or a mutual finance depositor protection fund prescribed in the Act on the Structural Improvement of Forestry Cooperatives, acquires from an insolvent cooperative in receipt of a determination to take timely corrective measures prescribed in Article 4 of the same Act (limited to an order to transfer a business or contract) or a determination to transfer contracts prescribed in Article 10 (2) of the same Act;
5. Property that a credit union prescribed in the Credit Unions Act acquires from an insolvent credit union in receipt of a determination to transfer contracts prescribed in Article 86-4 of the same Act;
6. Property that a credit cooperative prescribed in the Community Credit Cooperatives Act acquires from an insolvent credit cooperative in receipt of a determination to transfer contracts prescribed in Article 80-2 of the same Act.
(2) Property acquired by the Korea Asset Management Corporation pursuant to Article 26 (1) 9 or 10 of the Act on the Efficient Disposal of Non-Performing Assets, etc. of Financial Companies and the Establishment of Korea Asset Management Corporation, shall be exempted from acquisition tax until December 31, 2018. <Amended by Act No. 13637, Dec. 29, 2015; Act No. 15295, Dec. 26, 2017>
(3) Where the Korea Asset Management Corporation acquires assets owned by a small or medium enterprise pursuant to Article 26 (1) 7 of the Framework Act on Small and Medium Enterprises, acquisition tax shall be reduced by 50/100 until December 31, 2020. <Newly Inserted by Act No. 15295, Dec. 26, 2017>
(4) In cases of assets of a small or medium enterprise that the Korea Asset Management Corporation acquires, after fulfilling the requirements prescribed by Presidential Decree, by no later than December 31, 2020 with a condition to lease it to support normalization of the management of the small or medium enterprise and leases it to the relevant small and medium enterprise, property tax shall be reduced by 50/100 for five years from the date the first tax liability arises regarding the relevant asset. <Newly Inserted by Act No. 15295, Dec. 26, 2017>
[This Article Newly Inserted by Act No. 12955, Dec. 31, 2014]
 Article 58 (Special Taxation for Venture Businesses, etc.)
(1) Acquisition tax and property tax shall be reduced by 50/100 until December 31, 2020, respectively, on real estate acquired (including acquisition through the exercise of right of redemption prescribed in Article 41 of the Industrial Cluster Development and Factory Establishment Act) to sell in lots or lease after development and construction of a facility to cluster venture businesses or an area to cluster new-technology based businesses, designated pursuant to the Act on Special Measures for the Promotion of Venture Businesses: Provided, That the reduced portion of acquisition tax and property tax shall be collected as a penalty, where a facility to cluster venture businesses or an area to cluster new-technology based businesses is not developed and constructed within three years from the date of acquisition, without just grounds; where the designation of a facility to cluster venture businesses or an area to cluster new-technology based businesses is cancelled within five years from the date of acquisition of such real estate; or where such real estate is used for any other purpose within five years from the date it meets the requirements prescribed in Article 17-3 or 18 (2) of the Act on Special Measures for the Promotion of Venture Businesses. <Amended by Act No. 11618, Jan. 1, 2013; Act No. 12955, Dec. 31, 2014; Act No. 13637, Dec. 29, 2015; Act No. 15295, Dec. 26, 2017>
(2) When acquisition tax, registration license tax, and property tax are imposed on a person (excluding persons not constituting a venture business, among those who occupy a facility to cluster venture businesses) who occupies a facility to cluster venture businesses designated pursuant to the Act on Special Measures for the Promotion of Venture Businesses or a technopark constructed pursuant to the Act on Special Cases concerning Support of Technoparks, the tax rate prescribed in Articles 13 (1) through (4), 28 (2) and (3), and 111 (2) of the Local Tax Act, shall not apply until December 31, 2018. <Amended by Act No. 10417, Dec. 27, 2010; Act No. 11618, Jan. 1, 2013; Act No. 13637, Dec. 29, 2015>
(3) Acquisition tax shall be reduced by 50/100 until December 31, 2020, on real estate acquired by a person (including persons who intend to lease real estate for factories prescribed by Presidential Decree to small or medium business operators) who intends to construct or expand a building prescribed by Presidential Decree, being an industrial building, research facility, or building for pilot production (hereafter in this Article, referred to as "industrial building, etc."), in an area to cluster new-technology based businesses designated pursuant to Article 17-2 of the Act on Special Measures for the Promotion of Venture Businesses; and property tax on such real estate shall be reduced by 50/100 for three years from the date the first liability to pay property tax on such real estate arises: Provided, That the reduced portion of acquisition tax or property tax shall be collected as a penalty in any of the following cases: <Amended by Act No. 10417, Dec. 27, 2010; Act No. 11138, Dec. 31, 2011; Act No. 11618, Jan. 1, 2013; Act No. 12955, Dec. 31, 2014; Act No. 14477, Dec. 27, 2016; Act No. 15295, Dec. 26, 2017>
1. Where such real estate is not used for the relevant purposes without just grounds, within three years from the date of acquisition;
2. Where such real estate is sold, donated, or used for any other purpose, after having been used directly for the relevant purposes for less than two years.
(4) Local taxes shall be reduced, as follows, on any venture business prescribed in the Act on Special Measures for the Promotion of Venture Businesses: <Newly Inserted by Act No. 11138, Dec. 31, 2011; Act No. 12175, Jan. 1, 2014; Act No. 14477, Dec. 27, 2016; Act No. 15295, Dec. 26, 2017>
1. Acquisition tax shall be reduced by 375/1,000 until December 31, 2019, on real estate acquired in a venture business development and promotion zone prescribed in Article 18-4 of the Act on Special Measures for the Promotion of Venture Businesses, to use directly for its unique duties;
2. Property tax shall be reduced by 375/1,000 until December 31, 2019 on real estate used directly for its unique duties in a venture business development and promotion zone prescribed in subparagraph 1 as at the tax base date.
 Article 58-2 (Reduction or Exemption for Knowledge Industry Centers, etc.)
(1) Local taxes imposed on any person who establishes a knowledge industry center pursuant to Article 28-2 of the Industrial Cluster Development and Factory Establishment Act, shall be reduced until December 31, 2019, as follows: <Amended by Act No. 12175, Jan. 1, 2014; Act No. 14477, Dec. 27, 2016>
1. Acquisition tax shall be reduced by 35/100 on real estate acquired to use directly for facilities prescribed in Article 28-5 (1) 1 and 2 of the Industrial Cluster Development and Factory Establishment Act (hereafter in this Article, referred to as "business facilities") by new construction or expansion (including land appurtenant to the newly constructed or expanded portion; hereafter in this Article, the same shall apply) and real estate acquired by new construction or expansion to sell it in parcels or rent for business facilities (limited to cases of sale in parcels or rent for small or medium enterprises defined in Article 2 of the Framework Act on Small and Medium Enterprises; hereafter in this Article, the same shall apply): Provided, That the reduced portion of acquisition tax shall be collected as a penalty in any of the following cases:
(a) Where construction works do not begin without just grounds, within one year from the date of acquisition;
(b) Where such real estate is sold, donated, or sold in parcels or rented for any other purpose, within five years from the date of acquisition;
2. Property tax shall be reduced by 375/1,000 on real estate used directly for business facilities, or used directly for the duties of sale in parcels or for the duties of lease for such business facilities as at the tax base date.
(2) Local taxes shall be reduced, as follows, on any occupant (limited to persons who operate small or medium enterprises prescribed in Article 2 of the Framework Act on Small and Medium Enterprises) who purchases parcels of a knowledge industry center from a person who has established such knowledge industry center through new construction or expansion under Article 28-4 of the Industrial Cluster Development and Factory Establishment Act, and becomes the first purchaser of such parcels: <Amended by Act No. 12175, Jan. 1, 2014; Act No. 14477, Dec. 27, 2016; Act No. 15295, Dec. 26, 2017>
1. Acquisition tax shall be reduced by 50/100 on real estate acquired by no later than December 31, 2019, to use directly for business facilities: Provided, That the reduced portion of acquisition tax shall be collected as a penalty in any of the following cases:
(a) Where such real estate is not used for the relevant purposes without just grounds, within one year from the date of acquisition;
(b) Where such real estate is sold, donated, or used for any other purpose, within five years from the date of acquisition;
2. Property tax shall be reduced by 375/1,000 until December 31, 2019 on real estate used directly for business facilities as at the tax base date.
[This Article Newly Inserted by Act No. 11138, Dec. 31, 2011]
 Article 58-3 (Reduction or Exemption for Small or Medium Start-Up Enterprises, etc.)
(1) Acquisition tax shall be reduced by 75/100 on real estate acquired by any of the following enterprises incorporated pursuant to subparagraph 1 of Article 2 of the Support for Small and Medium Enterprise Establishment Act, within four years from the date prescribed by Presidential Decree (hereafter in this Article, referred to as "date of incorporation"), to conduct the relevant business. In such cases, in cases falling under subparagraph 2, it shall be reduced for four years from the date the enterprise is verified as a venture business pursuant to Article 25 of the Act on Special Measures for the Promotion of Venture Businesses (hereafter in this Article, referred to as "date of verification"): <Amended by Act No. 13637, Dec. 29, 2015; Act No. 14477, Dec. 27, 2016; Act No. 15295, Dec. 26, 2017>
1. A small or medium enterprise incorporated by not later than December 31, 2020 in an area other than an over-concentration limitation zone of the Seoul Metropolitan area (hereafter in this Article, referred to as "small or medium start-up enterprise");
2. An enterprise prescribed by Presidential Decree and verified by not later than December 31, 2020 as a venture business prescribed in Article 25 of the Act on Special Measures for the Promotion of Venture Businesses within three years from the date of incorporation, among the venture businesses defined in subparagraph 1 of Article 2 of the same Act (hereafter in this Article, referred to as "small or medium start-up venture business").
(2) Property tax (referring to the amount of tax imposed under Article 111 of the Local Tax Act; hereafter in this Article, the same shall apply) on real estate (in cases of land appurtenant to a building, applicable only to the portion not exceeding the standard area for factory location prescribed by Presidential Decree or applicable rate by specific-use area prescribed by Presidential Decree) used directly (excluding lease) by a small or medium start-up enterprise or a small or medium start-up venture business incorporated by not later than December 31, 2020 for its relevant business, shall be exempted for three years from the date of incorporation (or the date of verification, in cases of small or medium start-up venture business) and reduced by 50/100 for the following two years. <Amended by Act No. 13637, Dec. 29, 2015; Act No. 14477, Dec. 27, 2016; Act No. 15295, Dec. 26, 2017>
(3) Any of the following registrations shall be exempted from registration license tax: <Amended by Act No. 13637, Dec. 29, 2015; Act No. 14477, Dec. 27, 2016; Act No. 15295, Dec. 26, 2017>
1. Registration to incorporate a small or medium start-up enterprise incorporated by not later than December 31, 2020 (including where the amount of capital or investment increases within four years from the date of incorporation);
2. Registration to incorporate a small or medium enterprise verified by not later than December 31, 2020 as a venture business during its start-up of business under Article 2-2 (1) 2 (c) of the Act on Special Measures for the Promotion of Venture Businesses, which is completed within one year from the date of verification.
(4) The scope of small or medium start-up enterprises and small or medium start-up venture businesses shall be limited to small or medium enterprises operating the following types of business: <Amended by Act No. 14477, Dec. 27, 2016>
1. Mining business;
2. Manufacturing business;
3. Construction business;
4. Publishing business;
5. Video and audio documentary production and distribution business (excluding video viewing room operation business);
6. Broadcasting business;
7. Telecommunications business;
8. Computer programming, system integration and management business;
9. Information service business (excluding business providing news information);
10. Research and development business;
11. Advertising business;
12. Specialized design business;
13. Exhibition and event agency business;
14. Service business related to creation and art (excluding individual artists);
15. Engineering business prescribed by Presidential Decree (hereinafter referred to as "engineering business");
16. Logistics industry prescribed by Presidential Decree (hereinafter referred to as "logistics industry");
17. Business operating private institutes teaching vocational skills under the Act on the Establishment and Operation of Private Teaching Institutes and Extracurricular Lessons; or business operating vacational skill development training establishments under the Act on the Development of Vocational Skills of Workers (limited to where vocational skill development training is the principal business);
18. Exhibition industry under the Act on the Development of Exhibition Industry;
19. Human resource supply and placement business (including business supplying agricultural laborers);
20. Business cleaning buildings and industrial facilities;
21. Security and escort business;
22. Market research and public opinion polling business;
23. Tourist accommodation business, international conference business, and amusement facilities business under the Tourism Promotion Act, or tourist facilities business prescribed by Presidential Decree;
24. Other science and technology service business.
(5) For the purposes of paragraphs (1) through (4), no reduction or exemption for a small or medium start-up venture business shall apply, where it is granted exemption of local tax as a small or medium start-up enterprise. <Newly Inserted by Act No. 14477, Dec. 27, 2016>
(6) For the purposes of paragraphs (1) through (4), none of the following cases shall be deemed a new business startup: <Newly Inserted by Act No. 14477, Dec. 27, 2016>
1. Where a previous business is succeeded to by a merger, division, investment in kind, or acquisition of business, or where a business of the same type is conducted through an acquisition or purchase of the assets used in the previous business: Provided, That where the assets used for the previous business are acquired or purchased to operate the same type of business and the ratio of the total value of the relevant assets to the total value of business assets prescribed by Presidential Decree, including land, buildings, and machinery, is less than 50/100 and falls short of the ratio determined by Presidential Decree, as at the time the business has commenced pursuant to Article 5 (2) of the Value-Added Tax Act, such cases shall be excluded;
2. Where a new corporation is incorporated by converting a business operated by a resident, into a corporation;
3. Where a business of the same type as the one before its closure is operated by starting a business again after its closure;
4. Where it is difficult to deem that a new business has been started, as it involves expanding the existing business or adding another business line, etc.
(7) In any of the following cases, the portion of acquisition tax reduced pursuant to paragraph (1) shall be collected as a penalty: Provided, That this shall not apply in cases of consolidation under Article 31 (1) of the Restriction of Special Taxation Act (hereafter in this Article, referred to as "consolidation among small or medium enterprises") and conversion into a corporation under Article 32 (1) of the same Act (hereafter in this Article, referred to as "conversion into a corporation"): <Newly Inserted by Act No. 14477, Dec. 27, 2016>
1. Where the real estate is not used directly for the relevant business without just grounds, within three years from the date of acquisition;
2. Where the real estate is used for any other purpose, sold, or donated within three years from the date of acquisition;
3. Where the real estate is used for any other purpose, sold, or donated without being used directly for the relevant business for two consecutive years from the date of its first use.
(8) Where any small or medium start-up enterprises or small or medium start-up venture businesses are consolidated among small or medium enterprises or converted into corporations before the period of reduction prescribed in paragraph (2) passes, such corporations are eligible for the application of paragraph (2) for the period of reduction, as prescribed by Presidential Decree: Provided, That the same shall apply only to property for business acquired before such consolidation among small or medium enterprises or conversion into corporations. <Amended by Act No. 14477, Dec. 27, 2016>
(9) A person seeking tax reduction or exemption for a small or medium start-up enterprise or a small or medium start-up venture business prescribed in paragraphs (1) through (4), shall submit an application for tax reduction or exemption prescribed by Ordinance of the Ministry of the Interior and Safety, to the head of the competent local government. <Amended by Act No. 14477, Dec. 27, 2016; Act No. 14839, Jul. 26, 2017>
[This Article Newly Inserted by Act No. 12955, Dec. 31, 2014]
 Article 59 (Reduction or Exemption for the Small and Medium Business Corporation, etc.)
(1) Acquisition tax shall be reduced by 25/100 until December 31, 2020, on real estate for educational facilities acquired by the Small and Medium Business Corporation prescribed in the Small and Medium Enterprises Promotion Act, to train specialized technical human resources. <Amended by Act No. 11618, Jan. 1, 2013; Act No. 12955, Dec. 31, 2014; Act No. 15295, Dec. 26, 2017>
(2) Acquisition tax shall be reduced by 50/100 on real estate acquired by the Small and Medium Business Corporation prescribed in the Small and Medium Enterprises Promotion Act, to sell in lots or to rent to any small or medium business operator; and property tax shall be reduced by 50/100 on real estate used directly for the relevant business as at the tax base date, until December 31, 2019, respectively. <Amended by Act No. 11618, Jan. 1, 2013; Act No. 13637, Dec. 29, 2015; Act No. 14477, Dec. 27, 2016>
(3) Acquisition tax shall be reduced by 50/100 until December 31, 2020, on real estate for factories (excluding where the real estate already used for the relevant business, is acquired by succession; and where business has been suspended for at least 60 days as at the tax base date) first acquired by a person whose plan to engage in cooperation has been approved pursuant to Article 29 of the Small and Medium Enterprises Promotion Act (in cases of an over-concentration limitation zone and a Metropolitan area, limited to where approval has been obtained in an industrial complex prescribed in the Industrial Cluster Development and Factory Establishment Act), to use directly for the relevant business or to sell in lots or lease; and property tax on such real estate shall be reduced by 50/100 for three years from the date the first liability for property tax on such real estate arises. <Amended by Act No. 11618, Jan. 1, 2013; Act No. 12955, Dec. 31, 2014; Act No. 15295, Dec. 26, 2017>
(4) For the purposes of paragraph (2) or (3), where real estate is not used directly for a factory within one year from the date of acquisition, without just grounds, or where it is transferred to a third person for any purpose, other than that of the factory, within five years from the date of acquisition; or it is used for any other purpose, the reduced or exempted portion of acquisition tax and property tax shall be collected as a penalty. <Amended by Act No. 13637, Dec. 29, 2015>
 Article 60 (Special Taxation for Small and Medium Enterprise Cooperatives, etc.)
(1) Acquisition tax shall be reduced by 50/100 until December 31, 2020, on real estate for joint facilities acquired by an association of small or medium enterprises (including business cooperatives, a federation, and a central association) established pursuant to the Small and Medium Enterprise Cooperatives Act for manufacturing, processing, taking orders on, selling, or transporting, goods of small or medium enterprises: Provided, That in cases of a cooperative or business cooperative established by merchants of a traditional market, as copartners, under the Special Act on the Development of Traditional Markets and Shopping Districts, and a cooperative and business cooperative established by business operators prescribed by Presidential Decree as copartners, acquisition tax shall be reduced by 75/100 until December 31, 2020. <Amended by Act No. 11138, Dec. 31, 2011; Act No. 11618, Jan. 1, 2013; Act No. 12955, Dec. 31, 2014; Act No. 13637, Dec. 29, 2015; Act No. 15295, Dec. 26, 2017>
(2) Acquisition tax on the acquisition of a newly-built building acquired by the Korea Federation of Small and Medium Business established pursuant to the Small and Medium Enterprise Cooperatives Act, for its central association, members, etc. to use, shall be imposed at 20/1,000 until December 31, 2019, notwithstanding the tax rate prescribed in Article 11 (1) 3 of the Local Tax Act: Provided, That the reduced portion of acquisition tax shall be collected as a penalty in any of the following cases: <Amended by Act No. 10417, Dec. 27, 2010; Act No. 11138, Dec. 31, 2011; Act No. 12955, Dec. 31, 2014; Act No. 13637, Dec. 29, 2015; Act No. 14477, Dec. 27, 2016>
1. Where such building is used commercially within five years from the date of acquisition;
2. Where such building is not used directly for the relevant purposes without just grounds, within one year from the date of registration;
3. Where such building is sold, donated, or used for any other purpose, after having been used directly for the relevant purposes for less than two years.
(3) Local taxes imposed on a business incubator prescribed in the Support for Small and Medium Enterprise Establishment Act, shall be reduced as follows: <Amended by Act No. 10417, Dec. 27, 2010; Act No. 11618, Jan. 1, 2013; Act No. 12955, Dec. 31, 2014; Act No. 13637, Dec. 29, 2015; Act No. 14477, Dec. 27, 2016; Act No. 15295, Dec. 26, 2017>
1. Acquisition tax shall be reduced by 75/100 on real estate acquired by a person designated as an operator of a business incubator, to use directly for a business incubator; and property tax shall be reduced by 50/100 on such property, until December 31, 2020, respectively;
1-2. Acquisition tax shall be reduced by 75/100 on real estate acquired by a school, etc. referred to in Article 41 (1) (including real estate acquired by a school, etc. but managed by an industry-academic cooperation foundation prescribed in the Industrial Education Enhancement and Industry-Academia-Research Cooperation Promotion Act), to use directly for a business incubator after being designated as an operator of a business incubator; and property tax (including an amount imposed pursuant to Article 112 of the Local Tax Act), shall be reduced by 100/100 on such real estate, until December 31, 2020, respectively;
2. Tax rates referred to in Articles 13 (1) through (4), 28 (2) and (3), and 111 (2) of the Local Tax Act, shall not apply until December 31, 2018, when acquisition tax, registration license tax, or property tax is imposed on a person who occupies a business incubator.
(4) Local taxes shall be reduced until December 31, 2019, as follows, on a corporation prescribed by Presidential Decree, established by the Special Metropolitan City Mayor, a Metropolitan City Mayor, a Special Self-Governing City Mayor, a Do Governor, or a Special Self-Governing Province Governor, to provide comprehensive support, such as providing information on management, industrial technology, and trade, to local small or medium enterprises defined in subparagraph 1-3 of Article 2 of the Small and Medium Enterprises Promotion Act: <Newly Inserted by Act No. 11138, Dec. 31, 2011; Act No. 12175, Jan. 1, 2014; Act No. 13637, Dec. 29, 2015; Act No. 14111, Mar. 29, 2016; Act No. 14477, Dec. 27, 2016>
1. Acquisition tax shall be reduced by 50/100 on real estate acquired to use directly for its unique duties;
2. Deleted; <by Act No. 14477, Dec. 27, 2016>
3. Property tax shall be reduced by 50/100 on real estate used directly for its unique duties as at the tax base date.
 Article 61 (Reduction or Exemption for Urban Gas Business, etc.)
(1) Acquisition tax and property tax shall be reduced by 50/100 until December 31, 2016, respectively, on gas pipelines acquired by the Korea Gas Corporation incorporated pursuant to the Korea Gas Corporation Act or by an urban gas service provider permitted pursuant to Article 3 of the Urban Gas Business Act, to use directly for urban gas business: Provided, That in cases of gas pipelines in the Special Metropolitan City and Metropolitan Cities, such taxes shall not be reduced. <Amended by Act No. 11618, Jan. 1, 2013; Act No. 13637, Dec. 29, 2015>
(2) Acquisition tax and property tax shall be reduced by 50/100 until December 31, 2016, respectively, on heat transfer tubes acquired by the Korea District Heating Corporation incorporated pursuant to the Integrated Energy Supply Act or a district heating service provider permitted pursuant to Article 9 of the Integrated Energy Supply Act, to use directly for heat supply business: Provided, That in cases of heat transfer tubes in the Special Metropolitan City and Metropolitan Cities, such taxes shall not be reduced. <Amended by Act No. 11618, Jan. 1, 2013; Act No. 13637, Dec. 29, 2015>
 Article 62 (Reduction or Exemption for Support for Mining)
(1) Registration license tax shall be exempted on a newly obtained or modified license, which amounts to establishment, modification, or transfer of a mining right, or other registration.
(2) Acquisition tax shall be exempted on the mining right to be obtained upon an application and standing trees acquired for use in mining. <Amended by Act No. 13637, Dec. 29, 2015>
(3) Property tax shall be reduced by 25/100 until December 31, 2019, on buildings and appurtenant land (limited to one, the area of which is within seven times the projected horizontal area of buildings) used by the Korea Resources Corporation incorporated pursuant to the Korea Resources Corporation Act directly for training facilities for masonry trainees or for facilities for training on commission of miners prescribed in Article 5 (1) 5 of the Mining Safety Act as at the tax base date. <Amended by Act No. 11618, Jan. 1, 2013; Act No. 12955, Dec. 31, 2014; Act No. 13637, Dec. 29, 2015; Act No. 13729, Jan. 6, 2016; Act No. 14477, Dec. 27, 2016>
 Article 62-2 (Reduction and Exemption to Gas Stations among Oil Selling Business)
Where a gas station, among petroleum sales business under Article 10 of the Petroleum and Alternative Fuel Business Act, enters into a contract for purchasing petroleum products with the Korea National Oil Corporation under the Korea National Oil Corporation Act, and meets requirements prescribed by Presidential Decree, such as the compulsory purchasing rates of petroleum products purchased from the Korea National Oil Corporation, property tax on real estate used directly for sale of oil products, shall be reduced by 50/100 until December 31, 2014.
[This Article Newly Inserted by Act No. 11618, Jan. 1, 2013]
SECTION 6 Support for Transportation and Traffic
 Article 63 (Reduction or Exemption for Railroad Facilities, etc.)
(1) Acquisition tax shall be reduced by 25/100 on real estate for railroad facilities defined in subparagraph 2 of Article 3 of the Framework Act on Railroad Industry Development (excluding facilities defined in items (e) and (f) of the same subparagraph; hereafter in this paragraph, referred to as "railroad facilities") acquired by the Korea Rail Network Authority incorporated pursuant to the Korea Rail Network Authority Act (hereafter in this paragraph, referred to as the "Korea Rail Network Authority); and property tax (including an amount imposed pursuant to Article 112 of the Local Tax Act), shall be reduced by 25/100 on real estate used directly for railroad facilities as at the tax base date, until December 31, 2019, respectively. <Amended by Act No. 12955, Dec. 31, 2014; Act No. 13637, Dec. 29, 2015; Act No. 14477, Dec. 27, 2016; Act No. 15295, Dec. 26, 2017>
1. and 2. Deleted. <by Act No. 14477, Dec. 27, 2016>
(2) Any of the following property acquired by the Korea Rail Network Authority, shall be exempted from acquisition tax and property tax (including an amount imposed pursuant to Article 112 of the Local Tax Act) until December 31, 2019, respectively: <Newly Inserted by Act No. 14477, Dec. 27, 2016>
1. Railroad cars defined in subparagraph 4 of Article 3 of the Framework Act on Railroad Industry Development;
2. Real estate devolved to the State under Article 17 (1) or (3) of the Railroad Construction Act (limited to where a project implementer is the Korea Rail Network Authority).
(3) Acquisition tax shall be reduced by 50/100 on real estate and railroad cars acquired by the Korea Railroad Corporation incorporated pursuant to the Korea Railroad Corporation Act, to use directly for projects (hereafter in this paragraph, referred to as "relevant project") under Article 9 (1) 1 through 3 and 6 of the same Act (limited to projects developing station buildings among projects under the same subparagraph); and property tax (including an amount imposed pursuant to Article 112 of the Local Tax Act), shall be reduced by 50/100 on real estate used directly for the relevant project as at the tax base date, until December 31, 2019, respectively. <Amended by Act No. 11618, Jan. 1, 2013; Act No. 12175, Jan. 1, 2014; Act No. 12955, Dec. 31, 2014; Act No. 13637, Dec. 29, 2015; Act No. 14477, Dec. 27, 2016>
(4) Acquisition tax shall be exempted on land acquired following conclusion and subdivision of land incorporated into a railroad construction site due to a railroad construction project; and registration license tax shall be exempted on the registration of division. <Amended by Act No. 13637, Dec. 29, 2015>
(5) Local taxes shall be reduced or exempted until December 31, 2019, as follows, on a local government-invested public corporation incorporated for metropolitan rapid transit business pursuant to the Local Public Enterprises Act (hereinafter referred to as "metropolitan rapid transit corporation"): <Newly Inserted by Act No. 11138, Dec. 31, 2011; Act No. 12175, Jan. 1, 2014; Act No. 14477, Dec. 27, 2016>
1. Acquisition tax on real estate acquired to use directly for its unique duties and on rolling stock, shall be reduced by an amount calculated by multiplying 100/100 (where a municipal ordinance prescribes otherwise within 100/100, such rate shall apply thereto) of acquisition tax by the proportion of stocks [referring to the proportion of stocks held by a local government (including stocks in which a local government is deemed to have invested pursuant to Article 53 (4) of the Local Public Enterprises Act) held by the relevant local government among all stocks issued by the relevant metropolitan rapid transit corporation; hereafter in this Article, the same shall apply];
2. Registration license tax on registration of such corporation and the registration of establishment of divided superficies, shall be reduced by an amount calculated by multiplying 100/100 (where a municipal ordinance prescribes otherwise within 100/100, such rate shall apply thereto) of registration license tax by the proportion of stocks held by the local government;
3. Property tax (including an amount imposed pursuant to Article 112 of the Local Tax Act) on real estate used directly for its unique duties as at the tax base date, shall be reduced by an amount calculated by multiplying 100/100 (where a municipal ordinance prescribes otherwise within 100/100, such rate shall apply thereto) of property tax by the proportion of stocks held by the local government.
 Article 64 (Special Taxation for Support for Marine Transportation, Ports, etc.)
(1) Acquisition tax on a ship acquired to register as an international ship under the International Ship Registration Act, shall be imposed after subtracting 20/1,000 from the tax rate prescribed in Article 12 (1) 1 of the Local Tax Act until December 31, 2018; property tax on a ship registered as an international ship as at the tax base date, shall be reduced by 50/100 until December 31, 2018; and local resource and facility tax prescribed in Article 146 (2) of the Local Tax Act, shall be exempted until December 31, 2018: Provided, That where such ship is not registered as an international ship within six months from the date of acquisition of such ship, the reduced or exempted portion of acquisition tax shall be collected as a penalty. <Amended by Act No. 11618, Jan. 1, 2013; Act No. 13637, Dec. 29, 2015; Act No. 14477, Dec. 27, 2016>
(2) Acquisition tax on a cargo ship prescribed by Presidential Decree, acquired to put on a coastal line, and on an ocean-going ship prescribed by Presidential Decree, acquired to put on an international line only, shall be imposed after subtracting 10/1,000 from the tax rate prescribed in Article 12 (1) 1 of the Local Tax Act until December 31, 2018; and property tax on a cargo ship and a ship used to put on an international line as at the tax base date, shall be reduced by 50/100 until December 31, 2018: Provided, That the reduced portion of acquisition tax shall be collected as a penalty in any of the following cases: <Amended by Act No. 10417, Dec. 27, 2010; Act No. 11138, Dec. 31, 2011; Act No. 11618, Jan. 1, 2013; Act No. 13637, Dec. 29, 2015; Act No. 14477, Dec. 27, 2016>
1. Where such ship is not used directly for the relevant purposes without just grounds, within one year from the date of acquisition;
2. Where such ship is sold, donated, or used for any other purpose, after having been used directly for the relevant purposes for less than two years.
(3) Acquisition tax on a ship fueled by natural gas among cargo ships prescribed by Presidential Decree, acquired to put on a costal line, shall be imposed after subtracting 20/1,000 from the tax rate prescribed in Article 12 (1) 1 of the Local Tax Act until December 31, 2019. <Newly Inserted by Act No. 14477, Dec. 27, 2016>
(4) Deleted. <by Act No. 11138, Dec. 31, 2011>
 Article 64-2 Deleted. <by Act No. 14477, Dec. 27, 2016>
 Article 65 (Special Taxation for Air Transport Business, etc.)
Acquisition tax on an aircraft acquired to use for domestic air transport business, international air transport business, small-scale air transport business, or aircraft-using business licensed or registered pursuant to the Aviation Business Act, shall be imposed after subtracting 20/1,000 (or 12/1,000 from January 1, 2017 to December 31, 2018) from the tax rate prescribed in Article 12 (1) 4 of the Local Tax Act until December 31, 2016; and property tax on an aircraft used directly for such business as at the tax base date, shall be reduced by 50/100 until December 31, 2018. <Amended by Act No. 11618, Jan. 1, 2013; Act No. 12955, Dec. 31, 2014; Act No. 13637, Dec. 29, 2015; Act No. 14115, Mar. 29, 2016>
 Article 66 (Reduction or Exemption for Replacement Motor Vehicles, etc.)
(1) Acquisition tax shall be exempted on a motor vehicle, etc. (including machinery and equipment; hereafter in this paragraph, referred to as "motor vehicle, etc.") of the same kind provided in exchange for, the motor vehicle, etc. (referring to a motor vehicle of the same kind prescribed in Article 3 of the Motor Vehicle Management Act in cases of motor vehicles) returned according to the standards for settlement of consumer disputes under the Framework Act on Consumers or the mediation of the Motor Vehicle Safety and Defect Deliberation Council under the Motor Vehicle Management Act due to manufacturing defects: Provided, That where the price of a motor vehicle, etc. acquired through exchange exceeds the price of the previous motor vehicle, etc., acquisition tax shall be imposed on such excess. <Amended by Act No. 13637, Dec. 29, 2015; Act No. 15295, Dec. 26, 2017>
(2) Registration license tax shall be exempted on the re-registration of a motor vehicle or construction machinery the registration of which was cancelled pursuant to Article 13 (7) of the Motor Vehicle Management Act or Article 6 (1) 8 of the Construction Machinery Management Act.
(3) The acquisition of a hybrid motor vehicle defined in subparagraph 5 of Article 2 of the Act on Promotion of Development and Distribution of Environment-Friendly Motor Vehicles, which meets the requirements prescribed in subparagraph 2 of the same Article, shall be exempted from local tax until December 31, 2018, as follows: <Amended by Act No. 11618, Jan. 1, 2013; Act No. 12955, Dec. 31, 2014; Act No. 13637, Dec. 29, 2015>
1. Where the amount of acquisition tax does not exceed 1.4 million won, the total amount of acquisition tax shall be exempted;
2. Where the amount of acquisition tax exceeds 1.4 million won, 1.4 million won shall be deducted from assessed tax.
(4) The acquisition of a motor vehicle publicly notified pursuant to subparagraph 6 of Article 2 of the Act on Promotion of Development and Distribution of Environment-Friendly Motor Vehicles as an electric vehicle defined in subparagraph 3 of the same Article or as a fuel cell vehicle defined in subparagraph 6 of the same Article, shall be reduced or exempted from local tax, as follows: <Newly Inserted by Act No. 11138, Dec. 31, 2011; Act No. 12955, Dec. 31, 2014; Act No. 13637, Dec. 29, 2015; Act No. 14477, Dec. 27, 2016>
1. Where the amount of acquisition tax does not exceed two million won, the total amount of acquisition tax shall be exempted; and where the amount of acquisition tax exceeds two million won, two million won shall be deducted from assessed tax, until December 31, 2018;
2. Where the amount of acquisition tax does not exceed 1.4 million won, the total amount of acquisition tax shall be exempted; and where the amount of acquisition tax exceeds 1.4 million won, 1.4 million won shall be deducted from assessed tax, from January 1, 2019 to December 31, 2019.
 Article 66-2 (Reduction or Exemption of Acquisition Tax for Replacement of Decrepit Diesel Vehicles)
(1) Where a person who owns (based on the date of registration) as of January 1, 2017 a motor vehicle for passengers and freight or freight motor vehicle, fueled by diesel and newly registered as at December 31, 2006, (excluding used motor vehicles acquired by a person registered for motor vehicle transaction business pursuant to the Motor Vehicle Management Act for sale or purchase; hereafter in this paragraph, referred to as "decrepit diesel vehicles"), acquires a motor vehicle for passengers and freight or freight motor vehicle under his/her name (limited to newly manufactured motor vehicles; hereafter in this paragraph, referred to as "newly manufactured vehicle") and newly registers it by no later than June 30, 2017 after scrapping it and cancelling its registration, acquisition tax on such motor vehicle shall be reduced by 50/100. In such cases, acquisition tax on only one newly manufactured vehicle, shall be reduced for each decrepit diesel vehicle.
(2) Where the reduced amount of acquisition tax under paragraph (1) does not exceed one million won per vehicle, the total amount of acquisition tax shall be exempted; and when the reduced amount of acquisition tax exceeds one million won, one million won shall be deducted from assessed tax.
[This Article Newly Inserted by Act No. 14477, Dec. 27, 2016]
 Article 67 (Special Taxation for Minicars, etc.)
(1) Where a motor vehicle of a size prescribed by Presidential Decree is acquired as a noncommercial passenger motor vehicle prescribed by Presidential Decree, among passenger motor vehicles specified in Article 3 (1) of the Motor Vehicle Management Act, such motor vehicle shall be exempted from acquisition tax until December 31, 2018: Provided, That where it is used for commercial purpose within one year from the date of acquisition, the exempted portion of acquisition tax shall be collected as a penalty <Amended by Act No. 11618, Jan. 1, 2013; Act No. 13637, Dec. 29, 2015; Act No. 15295, Dec. 26, 2017>
(2) Where a motor vehicle of a size prescribed by Presidential Decree is acquired, among vans or cargo motor vehicles specified in Article 3 (1) of the Motor Vehicle Management Act (excluding towed motor vehicles, the detailed criteria of classification of which under Article 3 of the same Act is cargo motor vehicles for special tasks), such motor vehicle shall be exempted from acquisition tax until December 31, 2018. <Amended by Act No. 11618, Jan. 1, 2013; Act No. 12955, Dec. 31, 2014; Act No. 13637, Dec. 29, 2015>
(3) Notwithstanding Article 127 (1) 1 of the Local Tax Act, motor vehicle tax on a motor vehicle prescribed by Ordinance of the Ministry of the Interior and Safety, which is a noncommercial passenger motor vehicle and is able to carry seven to ten passengers, shall be imposed at the tax rate for small general buses prescribed in Article 127 (1) 4 of the same Act until December 31, 2018. In such cases, it shall be limited to a motor vehicle registered or enrolled as a new motor vehicle as at December 31, 2007 under the Motor Vehicle Management Act. <Amended by Act No. 11690, Mar. 23, 2013; Act No. 12844, Nov. 19, 2014; Act No. 12955, Dec. 31, 2014; Act No. 13637, Dec. 29, 2015; Act No. 14477, Dec. 27, 2016; Act No. 14839, Jul. 26, 2017>
 Article 68 (Reduction or Exemption for Used Motor Vehicles, etc. for Sale or Export)
(1) A used motor vehicle or used construction machinery (hereafter in this Article, referred to as "used motor vehicle, etc.") acquired (excluding acquisition under Article 7 (4) of the Local Tax Act; hereafter in this Article, the same shall apply) by any of the following persons for sale or purchase, shall be exempted from acquisition tax and motor vehicle tax until December 31, 2018, respectively. In such cases, a motor vehicle tax exemption shall be granted regarding the period in which such used motor vehicle, etc. is registered in the name of any of the following persons: <Amended by Act No. 11618, Jan. 1, 2013; Act No. 13637, Dec. 29, 2015; Act No. 14477, Dec. 27, 2016>
1. A person who has registered a motor vehicle dealership pursuant to Article 53 of the Motor Vehicle Management Act;
2. A person who has registered a construction machinery dealership pursuant to Article 21 (1) of the Construction Machinery Management Act.
(2) Acquisition tax on used ships, used machinery and equipment, and used aircraft acquired for export by a person engaging in foreign trade under the Foreign Trade Act, shall be imposed after subtracting 20/1,000 from the tax rate prescribed in Article 12 (1) 1, 3, and 4 of the Local Tax Act until December 31, 2018; and acquisition tax on used motor vehicles acquired for export by a person engaging in foreign trade under the Foreign Trade Act, shall be exempted until December 31, 2018. <Amended by Act No. 11618, Jan. 1, 2013; Act No. 13637, Dec. 29, 2015>
(3) For the purposes of paragraphs (1) and (2), where used ships, used machinery and equipment, used aircraft, and used motor vehicles, etc. are not sold or exported within two years from the date of acquisition, the reduced or exempted portion of acquisition tax shall be collected as a penalty. <Amended by Act No. 11618, Jan. 1, 2013>
 Article 69 (Reduction or Exemption for Traffic Safety, etc.)
Where the Korea Transportation Safety Authority established under the Korea Transportation Safety Authority Act, acquires real estate for business prescribed in subparagraph 6 of Article 6 of the same Act or for a motor vehicle inspection station which conducts motor vehicle inspections as proxy after obtaining designation under Article 44 of the Motor Vehicle Management Act, acquisition tax shall be reduced by 25/100 until December 31, 2019. <Amended by Act No. 11618, Jan. 1, 2013; Act No. 13637, Dec. 29, 2015; Act No. 14477, Dec. 27, 2016; Act No. 14939, Oct. 24, 2017>
 Article 70 (Reduction or Exemption for Support for Transportation Business)
(1) Where a person who has obtained a license for passenger transport services under the Passenger Transport Service Act acquires a motor vehicle to use directly for services prescribed by Presidential Decree, such as urban bus transport services and community bus transport services, acquisition tax shall be reduced by 50/100 until December 31, 2018. <Amended by Act No. 11618, Jan. 1, 2013; Act No. 13637, Dec. 29, 2015>
(2) Deleted. <by Act No. 12844, Nov. 19, 2014>
(3) Where a person who has obtained a license for passenger transport services under the Passenger Transport Service Act acquires a natural gas bus to use directly for transport services, he/she shall be exempted from acquisition tax until December 31, 2018. <Amended by Act No. 11618, Jan. 1, 2013; Act No. 12955, Dec. 31, 2014; Act No. 13637, Dec. 29, 2015>
 Article 71 (Reduction or Exemption for Logistics Complexes, etc.)
(1) Acquisition tax shall be reduced by 35/100 on real estate acquired by a facilitator of logistics complex development business prescribed in Article 27 of the Act on the Development and Management of Logistics Facilities, to develop a logistics complex designated under Article 22 (1) of the same Act; and property tax shall be reduced by 35/100 on real estate used directly for the relevant business as at the tax base date, until December 31, 2019, respectively. <Amended by Act No. 11618, Jan. 1, 2013; Act No. 12955, Dec. 31, 2014; Act No. 14477, Dec. 27, 2016>
(2) Acquisition tax shall be reduced by 50/100 until December 31, 2019, on real estate prescribed by Presidential Decree acquired by a person who intends to directly operate logistics business in a logistics complex under paragraph (1); and property tax shall be reduced by 35/100 on real estate acquired by no later than December 31, 2019 and used directly for logistics business as at the tax base date, for five years from the date of acquisition thereof. <Amended by Act No. 11618, Jan. 1, 2013; Act No. 12955, Dec. 31, 2014; Act No. 14477, Dec. 27, 2016>
(3) Acquisition tax shall be reduced by 25/100 on real estate acquired by a person designated as a facilitator of composite logistics terminal business pursuant to the Act on Public-Private Partnerships in Infrastructure, to implement a construction plan authorized under Article 9 (1) of the Act on the Development and Management of Logistics Facilities; and property tax shall be reduced by 25/100 on real estate used directly for such business as at the tax base date, until December 31, 2019, respectively: Provided, That where such real estate is not used directly for such business without just grounds within three years from the date of acquisition, the reduced portion of acquisition tax shall be collected as a penalty. <Amended by Act No. 11138, Dec. 31, 2011; Act No. 12955, Dec. 31, 2014; Act No. 14477, Dec. 27, 2016>
(4) and (5) Deleted. <by Act No. 14477, Dec. 27, 2016>
 Article 72 (Special Taxation for Special Post Offices)
(1) Acquisition tax on real estate acquired to use directly for special post office business pursuant to the Special Post Offices Act, shall be imposed after subtracting 20/1,000 from the tax rate prescribed in Article 11 (1) of the Local Tax Act until December 31, 2019: Provided, That the reduced portion of acquisition tax shall be collected as a penalty in any of the following cases: <Amended by Act No. 10417, Dec. 27, 2010; Act No. 11138, Dec. 31, 2011; Act No. 12955, Dec. 31, 2014; Act No. 14477, Dec. 27, 2016>
1. Where such real estate is used commercially within five years from the date of acquisition;
2. Where such real estate is not used directly for the relevant purposes without just grounds, within one year from the date of acquisition;
3. Where such real estate is sold, donated, or used for any other purpose, after having been used directly for the relevant purposes for less than two years.
(2) Property tax (including an amount imposed pursuant to Article 112 of the Local Tax Act) and local resource and facility tax prescribed in Article 146 (2) of the Local Tax Act, shall be exempted until December 31, 2019, respectively, on real estate used by a special post office for official use or a public purpose as at the tax base date; and the pro rata property portion and pro rata employee portion of resident tax shall be exempted until December 31, 2019, respectively, on the special post office: Provided, That where such property is used commercially, or a fee is charged for use thereof; or part of such property is not used directly for its original purpose, no such taxes on such property or part thereof, shall be exempted. <Amended by Act No. 12175, Jan. 1, 2014; Act No. 12955, Dec. 31, 2014>
(3) Real estate acquired by the Special Post Office Pension Service established pursuant to the Special Post Offices Act, to use directly for the duties prescribed in Article 16 (1) of the same Act, shall be exempted from local taxes until December 31, 2014, as follows: <Amended by Act No. 11618, Jan. 1, 2013>
1. Acquisition tax and property tax shall be exempted, respectively, on real estate for projects for promoting welfare prescribed in Article 16 (1) 4 of the Special Post Offices Act;
2. Acquisition tax and property tax shall be reduced by 50/100, respectively, on real estate for duties prescribed in Article 16 (1) 3 and 5 of the Special Post Offices Act.
SECTION 7 Support for National Land and Regional Development
 Article 73 (Reduction or Exemption for Acquisition of Substitute Land due to Expropriation, etc. of Land)
(1) Where a person (including persons who have sold to an implementer of a public project, real estate, etc. necessary for the relevant public project to which the Act on Acquisition of and Compensation for Land, etc. for Public Works Projects applies and persons subject to the measures for relocation prescribed in Articles 78 (1) through (4) and 81 of the same Act) whose real estate (including ships, fishing rights, and mining rights; hereafter in this Article, referred to as "real estate, etc.") has been purchased, expropriated, or removed by another person (including persons whose construction plan under Article 55 (1) of the Tourism Promotion Act has been approved and the implementers of projects for rearranging agricultural and fishing villages under Article 56 of the Rearrangement of Agricultural and Fishing Villages Act) who was granted approval for a project which enables him/her to expropriate land, etc. under the relevant statutes, including the Act on Acquisition of and Compensation for Land, etc. for Public Works Projects, the National Land Planning and Utilization Act, and the Urban Development Act; enters into a contract on real estate to be acquired as a substitute or is granted permission for construction after the contract date or the announcement date (including the date a construction plan is announced under the Tourism Promotion Act and the date a development plan is announced under the Rearrangement of Agricultural and Fishing Villages Act) of the relevant project approved, and acquires real estate, etc. to substitute for the previous real estate, etc. (referring to the time when a contract of purchase in lots is signed where one purchases a house under construction) in an area classified as follows, within one year (or two years in cases of farmland under Article 6 (1)) from the date compensation money is last received (where substitute acquisition is impossible due to the circumstances of a person who was granted approval for a project, referring to the date acquisition is possible; where one is compensated with land under Article 63 (1) of the Act on Acquisition of and Compensation for Land, etc. for Public Works Projects, referring to the date acquisition of such land is possible; where one is compensated with bonds under Article 63 (6) and (7) of the same Act, referring to the date repayment period expires), acquisition tax on such acquisition shall be exempted: Provided, That where the total value of real estate, etc. newly acquired exceeds that of the previous real estate, etc., acquisition tax shall be imposed on such excess; and the standards and methods for calculating excess, etc. shall be prescribed by Presidential Decree: <Amended by Act No. 10417, Dec. 27, 2010; Act No. 13637, Dec. 29, 2015; Act No. 14477, Dec. 27, 2016>
1. Real estate, etc. other than farmland:
(a) An area in the Special Metropolitan City, a Metropolitan City, the Special Self-Governing City, a Do, or the Special Self-Governing Province where real estate, etc. is purchased, expropriated, or removed;
(b) An area other than that prescribed in item (a), in the Special Self-Governing City or a Si/Gun/Gu adjacent to the Special Self-Governing City or a Si/Gun/Gu where real estate, etc. is purchased, expropriated, or removed;
(c) An area in the Special Metropolitan City, a Metropolitan City, the Special Self-Governing City, or a Do adjacent to the Special Metropolitan City, a Metropolitan City, the Special Self-Governing City, or a Do where real estate, etc. is purchased, expropriated, or removed: Provided, That in cases of any designated area under Article 104-2 (1) of the Income Tax Act, such designated area shall be excluded;
2. Farmland (including a house acquired at a price less than 50/100 of the total amount of compensation by a self-employed farmer under Article 6 (1) to cultivate farmland):
(a) An area prescribed in subparagraph 1;
(b) An area other than that prescribed in item (a), excluding the designated areas prescribed in Article 104-2 (1) of the Income Tax Act.
(2) Notwithstanding paragraph (1), where a person acquires real estate subject to taxation under Article 13 (5) of the Local Tax Act or an absentee land owner prescribed by Presidential Decree acquires substitute real estate, acquisition tax shall be imposed. <Amended by Act No. 10417, Dec. 27, 2010>
(3) Acquisition tax shall be exempted on real estate acquired by exercising a right to repurchase under the Act on Acquisition of and Compensation for Land, etc. for Public Works Projects. <Amended by Act No. 13637, Dec. 29, 2015>
 Article 73-2 (Reduction or Exemption for Real Estate, etc. for Gratuitous Donation)
(1) Acquisition tax shall be exempted until December 31, 2018, on real estate or infrastructure acquired on condition that real estate or infrastructure owned by the State, etc. shall be transferred gratuitously or that the right to use the real estate or infrastructure subject to reversion or gratuitous donation shall be transferred gratuitously, in return for reversion or donation (hereafter in this Article, referred to as "reversion, etc.") to the State, local government, or local government association (hereafter in this Article, referred to as the "State, etc."), among real estate and infrastructure referred to in Article 9 (2) of the Local Tax Act.
(2) In cases falling under paragraph (1), where real estate or infrastructure is sold or donated to another person without fulfilling the conditions of reversion, etc. to the State, etc. or where conditions are changed not to revert, etc. to the State, etc., the exempted portion of acquisition tax shall be collected as a penalty.
[This Article Newly Inserted by Act No. 13637, Dec. 29, 2015]
 Article 74 (Reduction or Exemption for Urban Development Projects, etc.)
(1) Acquisition tax shall be exempted until December 31, 2019, on land acquired pursuant to a land replotting plan or bonds redeemed with land by an owner (including a successor; hereafter in this Article, the same shall apply) of real estate subject to an urban development project prescribed in the Urban Development Act or to a maintenance and improvement project (limited to redevelopment projects) prescribed in the Act on the Maintenance and Improvement of Urban Areas and Residential Environments when such projects are implemented, on land and buildings acquired pursuant to a management disposal plan (hereafter in this paragraph, referred to as "real estate acquired pursuant to a replotting plan, etc.") and on land allotted to compensate for development outlay or reserved land acquired by a project implementer: Provided, That acquisition tax shall be imposed on the following real estate: <Amended by Act No. 12955, Dec. 31, 2014; Act No. 14567, Feb. 8, 2017; Act No. 15295, Dec. 26, 2017>
1. Where the total value of real estate acquired pursuant to a replotting plan, etc. exceeds the total value of the previous real estate, and therefore, settlement money is to be assumed under the relevant statutes, such as the Act on the Improvement of Urban Areas and Residential Environments, real estate equivalent to such settlement money;
2. Where the total value of real estate acquired pursuant to a replotting plan, etc. exceeds the total value of the previous real estate, real estate equivalent to such excess. In such cases, it shall be limited to a person who acquires real estate by succession after a project is approved (where the location of acquired real estate as at the date of acquisition by succession is designated as a designated area under Article 104-2 (1) of the Income Tax Act, the designation of an urban development zone or the designation of a maintenance and improvement zone).
(2) The standards and methods for calculating excess, etc. prescribed in paragraph (1) 2, shall be prescribed by Presidential Decree.
(3) Acquisition tax shall be reduced by 75/100 until December 31, 2019, on real estate referred to in subparagraphs 1 through 3, acquired in the course of implementing a redevelopment project or dwelling condition improvement project under the Act on the Maintenance and Improvement of Urban Areas and Residential Environments; and acquisition tax shall be exempted until December 31, 2018, on real estate referred to in subparagraph 4 or 5: Provided, That where such real estate becomes subject to taxation under Article 13 (5) of the Local Tax Act within five years from the date of acquisition, or construction is performed in violation of relevant statutes, the reduced or exempted portion of acquisition tax shall be collected as a penalty: <Amended by Act No. 10417, Dec. 27, 2010; Act No. 11618, Jan. 1, 2013; Act No. 13637, Dec. 29, 2015; Act No. 14477, Dec. 27, 2016; Act No. 14567, Feb. 8, 2017; Act No. 15295, Dec. 26, 2017>
1. Real estate acquired by the implementer of a redevelopment project referred to in Article 25 of the Act on the Improvement of Urban Areas and Residential Environments to develop sites for the redevelopment project referred to in subparagraph 2 (b) of Article 2 of the same Act;
2. Houses acquired by the implementer of a redevelopment project referred to in Article 25 of the Act on the Improvement of Urban Areas and Residential Environments in accordance with a management and disposal plan for the relevant project referred to in Article 74 of the same Act;
3. Real estate acquired by the implementer of a residential environment improvement project referred to in Article 24 of the Act on the Improvement of Urban Areas and Residential Environments to implement a residential environment improvement project referred to in subparagraph 2 (a) of Article 2 of the same Act;
4. A house with an area for exclusive use not exceeding 85 square meters, (where settlement money is to be borne in accordance with the Act on the Improvement of Urban Areas and Residential Environments, including real estate corresponding to such settlement money), acquired by a real estate owner from the implementer of a redevelopment project as at the date a redevelopment project under the same Act is publicly notified;
5. A house acquired by a real estate owner as at the date a housing redevelopment project under the Act on the Improvement of Urban Areas and Residential Environments is publicly notified by directly ameliorating it pursuant to Article 23 (1) 1 of the same Act; or a house with an area for exclusive use not exceeding 85 square meters, acquired from the implementer of a residential environment improvement project pursuant to subparagraph 4 of the same paragraph.
 Article 75 (Reduction and Exemption for Regional Development Projects)
Real estate acquired by a person designated as a project implementer to implement a development project announced pursuant to the Balanced Regional Development and Support for Local Small and Medium Enterprises Act in an area designated as a development promotion zone under Article 9 of the same Act, shall be exempted from acquisition tax until December 31, 2015; and property tax on such real estate shall be reduced by 50/100 for five years from the date the first liability to pay property tax on such real estate arises: Provided, That where such real estate is not used directly for the project, is sold or donated within three years from the date of acquisition, without just grounds, the reduced or exempted portion of acquisition tax and property tax shall be collected as a penalty. <Amended by Act No. 10417, Dec. 27, 2010; Act No. 11618, Jan. 1, 2013>
 Article 75-2 (Reduction or Exemption for Start-Up Businesses, etc. in Enterprise City Development Zones or Regional Development Project Zones)
(1) Acquisition tax and property tax on real estate acquired to operate any of the following businesses, the category of business of which and the amount of investment in which meet the criteria prescribed by Presidential Decree, shall be subject to a reduction rate prescribed by municipal ordinance by up to 50/100 until December 31, 2019, respectively: <Amended by Act No. 14477, Dec. 27, 2016>
1. Business operated by an enterprise which starts a new business or newly establishes a place of business (excluding where it relocates any existing place of business) in an enterprise city development zone defined in subparagraph 2 of Article 2 of the Special Act on the Development of Enterprise Cities by no later than December 31, 2019, in the place of business located in such zone;
2. An enterprise city development project defined in subparagraph 3 of Article 2 of the Special Act on the Development of Enterprise Cities, implemented by a project implementer designated under Article 10 of the same Act;
3. Business operated by an enterprise (where a person is selected as an implementer of a development project and relocates in an abandoned mine area promotion district designated under the Special Act on the Assistance to the Development of Abandoned Mine Areas, deemed a regional development project area pursuant to Article 4 of the Addenda to the Regional Development Assistance Act (Act No. 12737), including a native who operates tourist accommodation business, general resort business, or livestock raising business) which starts a new business or newly establishes a place of business (excluding where it relocates any existing place of business) in a regional development project zone designated pursuant to Article 11 of the Regional Development Assistance Act (limited to a regional development project that falls under Article 7 (1) of the same Act) by no later than December 31, 2019, at the place of business located in such zone or area;
4. A regional development project implemented by a project implementer designated under Article 19 of the Regional Development Assistance Act in a regional development project zone referred to in Article 11 of the same Act (limited to a regional development project that falls under Article 7 (1) 1 of the same Act).
(2) The amount of local taxes reduced pursuant to paragraph (1) may be collected as a penalty, as prescribed by Presidential Decree.
[This Article Newly Inserted by Act No. 13637, Dec. 29, 2015]
 Article 76 (Reduction or Exemption for Land, etc. for Housing Site Development)
(1) Acquisition tax shall be reduced by 20/100 until December 31, 2019, on real estate acquired temporarily by the Korea Land and Housing Corporation, to use for projects prescribed by Presidential Decree, for supplying to a third party in accordance with a plan of the State or a local government. <Amended by Act No. 11618, Jan. 1, 2013; Act No. 12955, Dec. 31, 2014; Act No. 13637, Dec. 29, 2015; Act No. 14477, Dec. 27, 2016>
(2) Public facilities, appurtenant land, and a public site to be devolved to the State or a local government gratuitously pursuant to relevant statutes, being real estate in a housing site development project zone or complex construction project zone, among real estate acquired by the Korea Land and Housing Corporation to use directly for projects prescribed by Presidential Decree for supplying to a third party, shall be exempted from property tax (including an amount imposed pursuant to Article 112 of the Local Tax Act) until December 31, 2019. In such cases, the scope of public facilities and appurtenant land shall be prescribed by Presidential Decree. <Amended by Act No. 11618, Jan. 1, 2013; Act No. 12955, Dec. 31, 2014; Act No. 13637, Dec. 29, 2015; Act No. 14477, Dec. 27, 2016>
(3) Deleted. <by Act No. 11138, Dec. 31, 2011>
 Article 77 (Reduction or Exemption for Land for Constructing Complexes by the Korea Water Resources Corporation)
(1) Acquisition tax shall be reduced by 30/100 until December 31, 2019, on land for constructing complexes acquired by the Korea Water Resources Corporation incorporated pursuant to the Korea Water Resources Corporation Act, to sell in lots pursuant to a plan of the State or a local government. <Amended by Act No. 11618, Jan. 1, 2013; Act No. 12955, Dec. 31, 2014; Act No. 13637, Dec. 29, 2015; Act No. 14477, Dec. 27, 2016>
(2) Public facilities, appurtenant land, and a public site to be devolved on the State or a local government gratuitously pursuant to relevant statutes, being real estate in a housing site development project zone or complex construction project zone, among real estate acquired by the Korea Water Resources Corporation incorporated pursuant to the Korea Water Resources Corporation Act, to sell in lots pursuant to a plan of the State or a local government, shall be exempted from property tax (including an amount imposed pursuant to Article 112 of the Local Tax Act) until December 31, 2019. In such cases, the scope of public facilities and appurtenant land shall be prescribed by Presidential Decree. <Amended by Act No. 11618, Jan. 1, 2013; Act No. 12955, Dec. 31, 2014; Act No. 13637, Dec. 29, 2015; Act No. 14477, Dec. 27, 2016>
 Article 78 (Reduction for Industrial Complexes, etc.)
(1) Acquisition tax shall be reduced by 35/100 on real estate acquired by an implementer of an industrial complex development project prescribed in Article 16 of the Industrial Sites and Development Act or a project implementer prescribed in Article 4 of the Act on Special Cases concerning Support for Technoparks, to construct an industrial complex or technopark; and property tax on land on which construction works are underway, shall be reduced by 35/100 (or 60/100 in cases of an industrial complex outside of Seoul Metropolitan area), until December 31, 2019, respectively: Provided, That where an industrial complex or technopark is not constructed within three years from the date of acquisition of real estate acquired to construct an industrial complex or technopark, without just grounds, the reduced portion of acquisition tax and property tax shall be collected as a penalty. <Amended by Act No. 11618, Jan. 1, 2013; Act No. 12955, Dec. 31, 2014; Act No. 13637, Dec. 29, 2015; Act No. 14477, Dec. 27, 2016>
(2) Local taxes shall be reduced, as follows, on real estate acquired and owned by a project implementer under paragraph (1) for sale in lots or lease for an industrial building, etc. prescribed by Presidential Decree (hereafter in this Article, referred to as "industrial buildings, etc."), after developing and constructing an industrial complex or technopark: <Amended by Act No. 10252, Apr. 12, 2010; Act No. 11618, Jan. 1, 2013; Act No. 12955, Dec. 31, 2014; Act No. 13637, Dec. 29, 2015; Act No. 14477, Dec. 27, 2016; Act No. 15295, Dec. 26, 2017>
1. Acquisition tax shall be reduced by 35/100 on an industrial building, etc. acquired by a project implementer prescribed in paragraph (1) by not later than December 31, 2019 by construction or expansion; and property tax on such industrial building, etc. shall be reduced by 35/100 (or 60/100, in cases of an industrial complex outside of Seoul Metropolitan area), respectively: Provided, That where the industrial building, etc. is not sold in lots or leased for the relevant purpose without just grounds, within three years from the date of acquisition, the reduced portion of local taxes shall be collected as a penalty;
2. Property tax on land, after a development projected is completed thereon, acquired and owned (including where approval for use is obtained or it is actually used) by a project implementer prescribed in paragraph (1) until December 31, 2019, shall be reduced by 35/100 (or 60/100, in cases of an industrial complex outside of Seoul Metropolitan area) for five years from the date the first liability to pay property tax arises: Provided, That where the land is not sold in lots or leased for the relevant purpose without just grounds, within three years from the date a development projected is completed, the reduced portion of property tax shall be collected as a penalty.
(3) Local taxes shall be reduced, as follows, on real estate acquired and owned by a project implementer prescribed in paragraph (1) for direct use after developing and creating an industrial complex or technopark: <Amended by Act No. 14477, Dec. 27, 2016>
1. Acquisition tax shall be reduced by 35/100 on an industrial building, etc. acquired by a project implementer prescribed in paragraph (1) by not later than December 31, 2019 by construction or expansion; and property tax on such industrial building, etc. shall be reduced by 35/100 (or 60/100, in cases of an industrial complex outside of Seoul Metropolitan area), respectively, for five years from the date the first liability to pay property tax on such industrial building, etc. arises: Provided, That the reduced portion of local taxes shall be collected as a penalty in any of the following cases:
(a) Where the industrial building, etc. is not used directly for the relevant purpose without just grounds, within three years from the date of acquisition;
(b) Where the industrial building, etc. is sold, donated, or used for any other purpose, after having been used directly for the relevant purpose for less than two years;
2. Property tax on land, after a development projected is completed thereon, acquired and owned (including where approval for use is obtained or it is actually used) by a project implementer prescribed in paragraph (1) until December 31, 2019, shall be reduced by 35/100 (or 60/100, in cases of an industrial complex outside of Seoul Metropolitan area) for five years from the date the first liability to pay property tax arises: Provided, That the reduced portion of property tax shall be collected as a penalty in any of the following cases:
(a) Where the land is not used directly for the relevant purpose without just grounds, within three years from the date a development projected is completed;
(b) Where the land is sold, donated, or used for any other purpose, after having been used directly for the relevant purpose for less than two years.
(4) Local taxes on real estate acquired by a person other than a project implementer prescribed in paragraph (1), in an area specified in each item of subparagraph 1 (hereinafter referred to as "industrial complex, etc."), shall be reduced as prescribed under subparagraph 2: <Amended by Act No. 11138, Dec. 31, 2011; Act No. 11618, Jan. 1, 2013; Act No. 12175, Jan. 1, 2014; Act No. 12955, Dec. 31, 2014; Act No. 13637, Dec. 29, 2015; Act No. 14477, Dec. 27, 2016>
1. Areas eligible for local tax reduction:
(a) Industrial complexes designated pursuant to the Industrial Sites and Development Act;
(c) Technoparks created pursuant to the Act on Special Cases concerning Support of Technoparks;
2. Details of local tax reduction:
(a) Acquisition tax on real estate acquired by construction or expansion of an industrial building, etc. (including land appurtenant to the constructed or expanded portion), shall be reduced by 50/100 until December 31, 2019. In such cases, where a building (referring to a building defined in Article 2 (1) 2 of the Building Act) for factories is rented to small or medium business proprietors after construction or expansion, shall be included for such purpose;
(b) Acquisition tax on real estate acquired after substantial repair (limited to cases falling under Article 2 (1) 9 of the Building Act) of industrial buildings, etc. in any industrial complex, etc., shall be reduced by 25/100 until December 31, 2019;
(c) Property tax on real estate prescribed in item (a), shall be reduced by 35/100 (or 75/100, in cases of an industrial complex outside of Seoul Metropolitan area) for five years from the date the first tax liability on such real estate arises.
(5) In any of the following cases, acquisition tax and property tax on the relevant portion reduced or exempted pursuant to paragraph (4), shall be collected as a penalty: <Newly Inserted by Act No. 11138, Dec. 31, 2011>
1. Where real estate is not used directly for the relevant purposes without just grounds, within three years from the date of acquisition;
2. Where real estate is sold (excluding where the relevant industrial complex management institution or technopark management institution resells it), donated, or used for any other purpose, after having been used directly for the relevant purposes for less than two years.
(6) Where the Korea Industrial Complex Corporation prescribed in the Industrial Cluster Development and Factory Establishment Act (hereafter in this paragraph, referred as the "Korea Industrial Complex Corporation"), acquires real estate to perform a project prescribed in Article 45-13 (1) 3 or 5 of the same Act (including acquisition due to exercise of a right to redeem prescribed in Article 41 of the same Act), 35/100 of acquisition tax and 50/100 of property tax shall be reduced (or 75/100 of property tax shall be reduced in cases of an industrial complex in an area other than Seoul Metropolitan area) until December 31, 2019, respectively: Provided, That where the real estate is not used by the Korea Industrial Complex Corporation for a project prescribed in Article 45-13 (1) 3 or 5 of the Industrial Cluster Development and Factory Establishment Act without just grounds, within three years from the date of acquisition thereof, the reduced portion of acquisition tax and property tax shall be collected as a penalty. <Newly Inserted by Act No. 12955, Dec. 31, 2014; Act No. 13637, Dec. 29, 2015; Act No. 14477, Dec. 27, 2016>
(7) The type of business and size of factories, standards for application of reduction, exemption, etc. prescribed in paragraphs (2) through (4), shall be prescribed by Ordinance of the Ministry of the Interior and Safety. <Amended by Act No. 11690, Mar. 23, 2013; Act No. 12844, Nov. 19, 2014; Act No. 14477, Dec. 27, 2016; Act No. 14839, Jul. 26, 2017>
(8) In reducing acquisition tax under paragraph (4), the head of a local government may additionally reduce it by the rate prescribed by municipal ordinance by up to 25/100 (or 15/100, where acquisition tax is reduced under paragraph (4) 2 (b)), taking into account the economic conditions, etc. of the relevant region. In such cases, the main sentence of Article 4 (1), and Article 4 (6) and (7) shall not apply. <Newly Inserted by Act No. 12955, Dec. 31, 2014; Act No. 14477, Dec. 27, 2016>
 Article 79 (Reduction or Exemption for Relocating Corporations to Provinces)
(1) Where a corporation having its main office or principal office established in an over-concentration limitation zone and directly engaging in business, relocates its main office or principal office to an area other than a large city prescribed by Presidential Decree (hereafter in this Section, referred to as "large city"), after selling or leasing its main office or principal office, real estate acquired to directly engage in the relevant business shall be exempted from acquisition tax until December 31, 2018; and such real estate shall be exempted from property tax for five years from the date the first liability to pay property tax on such real estate arises and shall be reduced by 50/100 for three years thereafter: Provided, That the reduced or exempted portion of acquisition tax and property tax shall be collected as a penalty in any of the following cases: <Amended by Act No. 11618, Jan. 1, 2013; Act No. 13637, Dec. 29, 2015>
1. Where such corporation is dissolved after relocating (excluding dissolution in the course of a merger, split-off, or merger after split-off) or such corporation incorporates a corporation manufacturing the products that it manufactured when it was located in the over-concentration limitation zone before relocating while being granted a tax reduction or exemption;
2. Where the relevant real estate is sold, donated, or used for any other purpose, after having been used directly for the relevant business for less than two years.
(2) Where a corporation registered in a large city relocates its main office or principal office to an area other than a large city, the registration of such corporation and the registration of real estate following such relocation shall be exempted from registration license tax until December 31, 2018. <Amended by Act No. 11618, Jan. 1, 2013; Act No. 13637, Dec. 29, 2015>
(3) The scope of a main office or principal office to be relocated to an area other than a large city, and standards for application of reduction, exemption, etc. prescribed in paragraphs (1) and (2), shall be prescribed by Ordinance of the Ministry of the Interior and Safety. <Amended by Act No. 11690, Mar. 23, 2013; Act No. 12844, Nov. 19, 2014; Act No. 14839, Jul. 26, 2017>
 Article 80 (Reduction or Exemption for Relocating Factories to Provinces)
(1) Real estate acquired by a person, who operated a business in a large city with factory facilities and has closed such factory and has relocated to any area other than a large city where it is not prohibited or restricted to establish a factory, to continue the relevant business, shall be exempted from acquisition tax until December 31, 2018; and such real estate shall be exempted from property tax for five years from the date the first liability to pay property tax on such real estate arises and be reduced by 50/100 for the next three years: Provided, That the reduced or exempted portion of acquisition tax and property tax shall be collected as a penalty in any of the following cases: <Amended by Act No. 11618, Jan. 1, 2013; Act No. 13637, Dec. 29, 2015>
1. Where such person re-establishes in a large city, a factory manufacturing products that he/she manufactured when he/she was located in the large city before relocating, while being granted local tax reduction or exemption;
2. Where the relevant real estate is sold, donated, or used for any other purpose, after having been used directly for the relevant business for less than two years.
(2) The type of business and size of a factory and standards for applying exemption, reduction, etc. prescribed in paragraph (1), shall be prescribed by Ordinance of the Ministry of the Interior and Safety. <Amended by Act No. 11690, Mar. 23, 2013; Act No. 12844, Nov. 19, 2014; Act No. 14839, Jul. 26, 2017>
 Article 81 (Reduction or Exemption for Relocating Public Agencies, etc. to Provinces)
(1) Acquisition tax on real estate acquired by a relocating public agency defined in subparagraph 2 of Article 2 of the Special Act on the Construction and Development of Innovation Cities (hereafter in this Article, referred to as "relocating public agency") for the purposes of relocation after obtaining approval of a plan for relocation to provinces from the Minister of Land, Infrastructure and Transport under Article 4 of the same Act, shall be reduced by 50/100 until December 31, 2017; and property tax on such real estate shall be reduced by 50/100 for five years from the date the first liability to pay property tax on such real estate arises. <Amended by Act No. 11618, Jan. 1, 2013; Act No. 11690, Mar. 23, 2013; Act No. 13637, Dec. 29, 2015; Act No. 14477, Dec. 27, 2016; Act No. 15309, Dec. 26, 2017>
(2) The corporate registration of a relocating public agency shall be exempted from registration license tax until December 31, 2016. <Amended by Act No. 11618, Jan. 1, 2013; Act No. 13637, Dec. 29, 2015>
(3) Where a person prescribed under subparagraph 1 becomes qualified as one household owning only one house prescribed by Presidential Decree by acquiring a house to reside in the relevant area, acquisition tax shall be reduced or exempted until December 31, 2019, as prescribed under subparagraph 2: <Amended by Act No. 11138, Dec. 31, 2011; Act No. 11618, Jan. 1, 2013; Act No. 13288, May 18, 2015; Act No. 13637, Dec. 29, 2015; Act No. 14477, Dec. 27, 2016>
1. Persons eligible for reduction or exemption:
(a) Executives and employees relocating along with relocating public agencies;
(b) Public officials (including employees whose contract remains in effect until the date an agency to which they belong is relocated, who have been in service for at least one year on a contractual basis; and persons who serve as interns pursuant to Article 26-4 of the State Public Officials Act; hereafter in this Article, the same shall apply) who move to an Administrative City along with central administrative agencies and agencies belonging thereto (including agencies belonging to central administrative agencies not included in a relocation plan, but to be relocated to the Administrative City; hereafter in this Article, referred to as "central administrative agency, etc.") according to a relocation plan formulated under Article 16 of the Special Act on the Construction of Administrative City in Yeongi-Gongju Area for Follow-up Measures for New Administrative Capital;
(c) Public officials belonging to the National Agency for Administrative City Construction or the Sejong Government Complex Management Office;
2. Details of reduction or exemption:
(a) A house with an area for exclusive use by its occupants, not exceeding 85 square meters: To be exempted;
(b) A house with an area for exclusive use by its occupants, between 85 and 102 square meters: To be reduced by 750/1,000;
(c) A house with an area for exclusive use by its occupant, between 102 and 135 square meters: To be reduced by 625/1,000.
(4) Where a person granted acquisition tax reduction or exemption pursuant to paragraph (3) falls under any of the following cases without just grounds, such as death; marriage; relocation to a foreign country; old-aged retirement; or change of work area due to service in a dispatched division or personnel rotation between Ministries, the reduced or exempted portion of acquisition tax shall be collected as a penalty: <Newly Inserted by Act No. 11138, Dec. 31, 2011; Act No. 13637, Dec. 29, 2015; Act No. 15295, Dec. 26, 2017>
1. Where he/she sells or donates a house before the date the relocating public agency or central administrative agency, etc. (referring to the earlier of the date of registration or the date services begin, in cases of relocating public agencies, and referring to the date services begin, in cases of central administrative agencies, etc.; hereafter in this Article, the same shall apply) relocate;
2. Where a house is sold or donated within two years from any of the following dates:
(a) The date the relevant agency relocates (applicable only to the executives and employees or public officials affiliated with relocating public agencies, central administrative agencies, etc.);
(b) The date a house is acquired.
(5) Where a person who is an executive or employee, or public official (including a person specially provided with a house upon the head of an agency to which he/she belongs deeming him/her eligible for a house) belonging to a relocating public agency, central administrative agency, etc., the National Agency for Administrative City Construction, or the Sejong Government Complex Management Office (hereafter in this paragraph, referred to as "agency eligible for reduction or exemption") under paragraph (3) 1, and who contracted to acquire a house in the relevant district, but was not granted a reduction in or exemption from acquisition tax under paragraph (3), because he/she was obliged to work for an agency other than an agency eligible for reduction or exemption due to the official announcement of appointment at the time of acquisition of such house, returns to an agency eligible for reduction or exemption after he/she has completed the period of services within three years, an amount calculated by subtracting the amount of tax to be paid if an acquisition tax reduction or exemption granted under paragraph (3) 2 is applied to such house, from the amount of tax already paid, shall be refunded to him/her. <Newly Inserted by Act No. 11618, Jan. 1, 2013; Act No. 13637, Dec. 29, 2015>
 Article 82 (Reduction or Exemption for Improvement of Housing in Development Restriction Zones)
Where a person (in cases of a person verified as having resided in the over-concentration limitation zone for at least one year by resident registration card by household, etc. under the Resident Registration Act) residing in a development restriction zone prescribed in Article 3 of the Act on Special Measures for Designation and Management of Development Restriction Zones and his/her family, acquires, for residing at all times, a house to be improved pursuant to a community village improvement plan, with an area for exclusive use by its occupants, not exceeding 100 square meters, in an area subject to the designation of a community village zone, property tax on such house (land appurtenant thereto shall be limited to the portion not exceeding seven times the projected horizontal area of the residential building), shall be exempted for five years from the date the first liability to pay property tax arises after the acquisition of such residential building until December 31, 2018. <Amended by Act No. 12955, Dec. 31, 2014; Act No. 13637, Dec. 29, 2015>
 Article 83 (Reduction or Exemption for Market Improvement Projects)
(1) Real estate acquired by a person (hereafter in this Article, referred to as "market improvement project implementer") intending to promote a market improvement project in a market improvement zone approved pursuant to Article 37 of the Special Act on the Development of Traditional Markets and Shopping Districts, to use directly for such project, shall be exempted from acquisition tax until December 31, 2018; and property tax thereon shall be reduced by 50/100 for five years from the date the first liability to pay property tax on such real estate arises: Provided, That in cases of property tax on land, reduction or exemption shall apply from the date construction works begin. <Amended by Act No. 11618, Jan. 1, 2013; Act No. 13637, Dec. 29, 2015>
(2) Where a person prescribed by Presidential Decree acquires real estate as his/her first acquisition from a market improvement project implementer in a market improvement zone under paragraph (1), acquisition tax on such real estate (excluding houses) shall be exempted until December 31, 2018; and property tax on a building acquired due to the implementation of a market improvement project, shall be reduced by 50/100 for five years from the date the first liability to pay property tax on such building arises. <Amended by Act No. 11618, Jan. 1, 2013; Act No. 13637, Dec. 29, 2015>
(3) Where approval of a project promotion plan is cancelled pursuant to Article 38 of the Special Act on the Development of Traditional Markets and Shopping Districts; where real estate is not used directly for the project, within three years from the date of acquisition of such real estate, without just grounds; or where real estate is sold, donated, or used for any other purpose, the portion of acquisition tax reduced or exempted pursuant to paragraphs (1) and (2) shall be collected as a penalty. <Amended by Act No. 10417, Dec. 27, 2010; Act No. 13637, Dec. 29, 2015>
 Article 84 (Reduction or Exemption for Land, etc. with Restricted Private Rights)
(1) Property tax on land, buildings, and houses (limited to the relevant parts, respectively) prescribed in subparagraph 3 of Article 104 of the Local Tax Act on which the projects for urban planning facilities defined in subparagraph 7 of Article 2 of the National Land Planning and Utilization Act have not been implemented for at least ten consecutive years after the relevant topographical map was publicized pursuant to Article 32 of the same Act, shall be reduced by 50/100 until December 31, 2018; and the amount of tax to be imposed pursuant to Article 112 of the Local Tax Act, shall be exempted. <Amended by Act No. 11618, Jan. 1, 2013; Act No. 12955, Dec. 31, 2014>
(2) In cases of land (including land appurtenant to a house) for public facilities defined in subparagraph 13 of Article 2 of the National Land Planning and Utilization Act, for which the determination of an urban management plan and a topographical map concerning the urban management plan have been publicized pursuant to Articles 30 and 32 of the same Act, property tax on the relevant portion of land on which such plan has not been implemented as at the tax base date, shall be reduced by 50/100 until December 31, 2018. <Amended by Act No. 12955, Dec. 31, 2014; Act No. 13637, Dec. 29, 2015; Act No. 14477, Dec. 27, 2016>
(3) In cases of land on which construction, etc. is restricted pursuant to Article 45 of the Railroad Safety Act, property tax on the relevant portion shall be reduced by 50/100 until December 31, 2018. <Amended by Act No. 12955, Dec. 31, 2014>
SECTION 8 Support for Public Administration, etc.
 Article 85 (Reduction or Exemption for the Korea Rehabilitation Agency, etc.)
(1) Real estate acquired by the Korea Rehabilitation Agency under the Act on Probation, Etc. or a non-profit corporation permitted for relief and rehabilitation projects under the same Act, to use directly for relief and rehabilitation projects, shall be exempted from acquisition tax; and real estate used directly for such projects as at the tax base date, shall be exempted from property tax (including an amount imposed pursuant to Article 112 of the Local Tax Act) until December 31, 2019, respectively. <Amended by Act No. 11618, Jan. 1, 2013; Act No. 13637, Dec. 29, 2015; Act No. 14477, Dec. 27, 2016>
(2) Acquisition tax shall be reduced by 50/100 on real estate acquired to establish and operate a private correctional institution, etc. defined in subparagraph 4 of Article 2 of the Act on the Establishment and Operation of Private Correctional Institutions, Etc.; and property tax shall be reduced by 50/100 on real estate used directly for a private correctional institution, etc. as at the tax base date, until December 31, 2014, respectively. <Amended by Act No. 11138, Dec. 31, 2011; Act No. 12175, Jan. 1, 2014>
 Article 85-2 (Reduction or Exemption for Local Public Enterprises, etc.)
(1) Local taxes shall be reduced or exempted until December 31, 2019, as follows, on a local government-invested public corporation (excluding agricultural and marine products corporations and metropolitan rapid transit corporations) incorporated pursuant to the Local Public Enterprises Act: <Amended by Act No. 12175, Jan. 1, 2014; Act No. 13637, Dec. 29, 2015; Act No. 14477, Dec. 27, 2016>
1. Acquisition tax on real estate acquired to use directly for its unique duties, shall be reduced by an amount calculated by multiplying 50/100 (where a municipal ordinance prescribes otherwise within 50/100, such rate shall apply thereto) of acquisition tax, by the ratio of stocks held by the local government [referring to the ratio of stocks (including stocks in which the local government is deemed to have invested pursuant to Article 53 (4) of the Local Public Enterprise Act) held by the local government among all stocks issued by the relevant local government-invested public corporation; hereafter in this Article, the same shall apply];
2. Registration license tax on the registration of such corporation shall be reduced by an amount calculated by multiplying 50/100 (where a municipal ordinance prescribes otherwise within 50/100, such rate shall apply thereto) of registration license tax, by the ratio of stocks held by the local government;
3. Property tax (including an amount imposed pursuant to Article 112 of the Local Tax Act) on real estate used directly for its unique duties (excluding real estate for business referred to in Article 2 (1) 7 and 8 of the Local Public Enterprises Act) as at the tax base date, shall be reduced by an amount calculated by multiplying 50/100 (where a municipal ordinance prescribes otherwise within 50/100, such rate shall apply thereto) of property tax, by the ratio of stocks held by the local government;
4. Public facilities, appurtenant land, and a public site to be devolved on the State or a local government gratuitously pursuant to relevant statutes, being real estate in a housing site development project zone or complex construction project zone among real estate for business defined in Article 2 (1) 7 and 8 of the Local Public Enterprises Act, shall be exempted from property tax (including an amount imposed pursuant to Article 112 of the Local Tax Act) until December 31, 2019. In such cases, the scope of public facilities, appurtenant land, and a public site, shall be prescribed by Presidential Decree.
(2) Local taxes shall be reduced until December 31, 2019, as follows, on a local government public corporation incorporated pursuant to the Local Public Enterprises Act: <Amended by Act No. 12175, Jan. 1, 2014; Act No. 14477, Dec. 27, 2016>
1. Acquisition tax on real estate acquired to use directly for its unique duties, shall be reduced by 100/100 (where a municipal ordinance prescribes otherwise within 100/100, such rate shall apply thereto);
2. Registration license tax on the registration of such corporation, shall be reduced by 100/100 (where a municipal ordinance prescribes otherwise within 100/100, such rate shall apply thereto);
3. Property tax (including an amount imposed pursuant to Article 112 of the Local Tax Act) on real estate used directly for its unique duties as at the tax base date, shall be reduced by 100/100 (where a municipal ordinance prescribes otherwise within 100/100, such rate shall apply thereto).
(3) Local taxes shall be reduced until December 31, 2019, as follows, on a stock company under the Commercial Act (hereinafter referred to as "invested corporation") or on an incorporated foundation under the Civil Act (hereinafter referred to as "contributed corporation") incorporated with capital or property invested by a local government as at its incorporation: <Amended by Act No. 12175, Jan. 1, 2014; Act No. 14477, Dec. 27, 2016>
1. Acquisition tax on real estate acquired to use directly for its unique duties, shall be reduced by an amount calculated by multiplying 50/100 (where a municipal ordinance prescribes otherwise within 50/100, such rate shall apply thereto) of acquisition tax, by the ratio (hereafter in this Article, referred to as "investment or contribution ratio") classified as follows:
(a) Ratio of stocks held by the local government (stocks invested by a local government-invested public corporation incorporated by a local government shall be deemed invested by such local government) among all stocks issued by an invested corporation;
(b) Ratio of property contributed by a local government (property contributed by a local government-invested public corporation incorporated by a local government shall be deemed contributed by such local government) among the total value of property received by a contributed corporation;
2. Registration license tax on the registration of such corporation, shall be reduced by an amount calculated by multiplying 50/100 (where a municipal ordinance prescribes otherwise within 50/100, such rate shall apply thereto) of registration license tax, by the investment or contribution ratio of the local government;
3. Property tax (including an amount imposed pursuant to Article 112 of the Local Tax Act) on real estate used directly for its unique duties as at the tax base date, shall be reduced by multiplying 50/100 (where a municipal ordinance prescribes otherwise within 50/100, such rate shall apply thereto) of property tax, by the investment or contribution ratio of the local government.
(4) Acquisition tax shall be reduced by 25/100 until December 31, 2016, on real estate acquired by the Korea Local Information Research and Development Institute prescribed in Article 72 of the Electronic Government Act, to use directly for its unique duties. <Newly Inserted by Act No. 11618, Jan. 1, 2013; Act No. 12955, Dec. 31, 2014>
[This Article Newly Inserted by Act No. 11138, Dec. 31, 2011]
 Article 86 (Reduction or Exemption for Rental Housing, etc. to U.S. Forces Servicemen in Korea)
Acquisition tax shall be exempted until December 31, 2016, on real estate acquired by the Korea Land and Housing Corporation, to rent to U.S. Forces Servicemen in Korea; and property tax shall be reduced by 50/100 until December 31, 2016, on real estate used as rental housing as at the tax base date. <Amended by Act No. 11618, Jan. 1, 2013; Act No. 13637, Dec. 29, 2015>
 Article 87 (Reduction or Exemption for Community Credit Cooperatives, etc.)
(1) Local taxes shall be reduced or exempted, as follows, on credit unions incorporated pursuant to the Credit Unions Act (excluding the National Credit Union Federation of Korea; hereafter in subparagraphs 1 and 2, referred to as "credit unions"): <Amended by Act No. 11618, Jan. 1, 2013; Act No. 12955, Dec. 31, 2014; Act No. 13637, Dec. 29, 2015; Act No. 15295, Dec. 26, 2017>
1. Acquisition tax shall be exempted on real estate acquired by a credit union to use directly for the duties prescribed in Article 39 (1) 1 of the Credit Unions Act; and property tax shall be exempted on real estate used directly for such duties as at the tax base date, until December 31, 2020, respectively;
2. Acquisition tax on real estate acquired by a credit union to use directly for the duties prescribed in Article 39 (1) 2 or 4 of the Credit Unions Act and property tax on real estate used directly for such duties as at the base tax date shall be exempted, until December 31, 2020, respectively;
3. Acquisition tax shall be reduced by 25/100 on real estate acquired by the National Credit Union Federation of Korea incorporated pursuant to the Credit Unions Act, to use directly for the duties prescribed in Article 78 (1) 1 and 2 of the same Act; and property tax shall be reduced by 25/100 on real estate used directly for its business as at the tax base date, until December 31, 2017, respectively.
(2) Local taxes shall be reduced or exempted, as follows, on community credit cooperatives incorporated pursuant to the Community Credit Cooperatives Act (excluding the Korean Federation of Community Credit Cooperatives; hereafter in subparagraphs 1 and 2, referred to as "community credit cooperatives"): <Amended by Act No. 11138, Dec. 31, 2011; Act No. 11618, Jan. 1, 2013; Act No. 12955, Dec. 31, 2014; Act No. 13637, Dec. 29, 2015; Act No. 15295, Dec. 26, 2017>
1. Acquisition tax shall be exempted on real estate acquired by a community credit cooperative to use directly for the duties prescribed in Article 28 (1) 1, and property tax shall be exempted on real estate used directly for such duties as at the tax base date, until December 31, 2020, respectively;
2. Acquisition tax on real estate acquired by a community credit cooperative to use directly for the duties prescribed in Article 28 (1) 2 through (4) of the Community Credit Cooperatives Act; and property tax on real estate used directly for such duties as at the base tax date, shall be exempted, until December 31, 2020, respectively;
3. Acquisition tax shall be reduced by 25/100 on real estate acquired by the Korean Federation of Community Credit Cooperatives incorporated pursuant to the Community Credit Cooperatives Act, to use directly for the duties prescribed in Article 67 (1) 1 and 2 of the same Act; and property tax shall be reduced by 25/100 on real estate used directly for its business as at the tax base date, until December 31, 2017, respectively.
 Article 88 (Reduction or Exemption for Saemaeul Movement Organizations, etc.)
(1) Real estate (excluding rental real estate; hereafter in this Article, the same shall apply) acquired by a Saemaul movement organization, to which the Support of the Saemaul Movement Organization Act applies, to use for its unique duties, shall be exempted from acquisition tax; and real estate used directly for its unique duties as at the tax base date, shall be exempted from property tax (including an amount imposed pursuant to Article 112 of the Local Tax Act) until December 31, 2019, respectively. <Amended by Act No. 11618, Jan. 1, 2013; Act No. 12955, Dec. 31, 2014; Act No. 14477, Dec. 27, 2016>
(2) Real estate (excluding rental real estate) acquired by any of the following corporations, to use for its unique duties, shall be exempted from acquisition tax; and real estate used directly for its unique duties as at the tax base date, shall be exempted from property tax (including an amount imposed pursuant to Article 112 of the Local Tax Act) until December 31, 2014, respectively: <Amended by Act No. 11618, Jan. 1, 2013>
1. Korea Freedom Federation prescribed in the Korea Freedom Federation Support Act;
2. Korean Veterans Association prescribed in the Korea Veterans Association Act.
 Article 89 (Exemption for Political Parties)
(1) Acquisition tax shall be exempted until December 31, 2019, on real estate acquired by a political party established pursuant to the Political Parties Act (hereafter in this Article, referred to as "political party"), to use directly for any relevant business: Provided, That the exempted portion of acquisition tax shall be collected as a penalty in any of the following cases: <Amended by Act No. 10417, Dec. 27, 2010; Act No. 11138, Dec. 31, 2011; Act No. 12955, Dec. 31, 2014; Act No. 14477, Dec. 27, 2016>
1. Where such real estate is used commercially within five years from the date of acquisition;
2. Where such real estate is not used directly for the relevant purposes without just grounds, within three years from the date of acquisition;
3. Where such real estate is sold, donated, or used for any other purpose, after having been used directly for the relevant purposes for less than two years.
(2) Property tax (including an amount imposed pursuant to Article 112 of the Local Tax Act) and local resource and facility tax prescribed in Article 146 (2) of the Local Tax Act, shall be exempted until December 31, 2019, respectively, on real estate (including land appurtenant to buildings prescribed by Presidential Decree) used by a political party directly for the relevant business as at the tax base date: Provided, That where such real estate is used commercially, or a fee is charged for use thereof; or part of such property is not used directly for its original purpose, no such taxes on such property or part thereof, shall be exempted. <Amended by Act No. 12955, Dec. 31, 2014; Act No. 13637, Dec. 29, 2015>
(3) Registration license tax shall be exempted on a license used by a political party directly for its business; and the pro rata property portion and pro rata employee portion of resident tax shall be exempted on a political party, until December 31, 2019, respectively: Provided, That no pro rata property portion and pro rata employee portion of resident tax prescribed by Presidential Decree, shall be exempted when related to profit-making business. <Amended by Act No. 12175, Jan. 1, 2014; Act No. 12955, Dec. 31, 2014; Act No. 13637, Dec. 29, 2015>
(4) Where generated electricity, etc. is supplied to a political party gratuitously, local resource and facility tax prescribed in Article 146 (1) of the Local Tax Act on such portion, shall be exempted until December 31, 2019. <Amended by Act No. 12955, Dec. 31, 2014>
 Article 90 (Exemption for Village Associations, etc.)
(1) Where real estate and ships are acquired for joint ownership of the residents of a community, such as a village association prescribed by Presidential Decree (hereinafter referred to as "village association, etc."), acquisition tax thereon shall be exempted until December 31, 2019: Provided, That the exempted portion of acquisition tax shall be collected as a penalty in any of the following cases: <Amended by Act No. 10417, Dec. 27, 2010; Act No. 11138, Dec. 31, 2011; Act No. 12955, Dec. 31, 2014; Act No. 14477, Dec. 27, 2016; Act No. 15295, Dec. 26, 2017>
1. Where such real estate is used commercially within five years from the date of acquisition;
2. Where such real estate is not used directly for the relevant purposes without just grounds, within one year from the date of acquisition;
3. Where such real estate is sold or donated (excluding cases of gratuitous donation to the State or a local government to use for the relevant purpose), or used for any other purpose, after having been used directly for the relevant purposes for less than two years.
(2) Property tax (including an amount imposed pursuant to Article 112 of the Local Tax Act) and local resource and facility tax prescribed in Article 146 (2) of the Local Tax Act, shall be exempted on real estate and woodland owned by a village association, etc.; and the pro rata property portion and pro rata employee portion of resident tax, shall be exempted on the village association, etc., until December 31, 2019, respectively: Provided, That where such real estate or woodland is used commercially, or a fee is charged for use thereof; or part of such property is not used directly for its original purpose, no such taxes on such property or part thereof, shall be exempted. <Amended by Act No. 12175, Jan. 1, 2014; Act No. 12955, Dec. 31, 2014>
 Article 91 (Special Taxation for Real Estate for Dormitories for Offspring of Diplomats Abroad)
Acquisition tax on land and buildings for a dormitory of offspring of diplomats abroad, owned by the Korean Council on Foreign Relations, an incorporated association, shall be imposed after applying 20/1,000, notwithstanding the tax rate prescribed in Article 11 (1) of the Local Tax Act; and registration license tax on the registration of such real estate, shall be exempted: Provided, That the reduced or exempted portion of acquisition tax and registration license tax shall be collected as a penalty in any of the following cases: <Amended by Act No. 10417, Dec. 27, 2010; Act No. 11138, Dec. 31, 2011; Act No. 14477, Dec. 27, 2016>
1. Where such real estate is used commercially within five years from the date of acquisition;
2. Where such real estate is not used directly for the relevant purposes without just grounds, within one year from the date of acquisition;
3. Where such real estate is sold, donated, or used for any other purpose, after having been used directly for the relevant purposes for less than two years.
 Article 92 (Reduction or Exemption for Substitute Acquisition due to Natural Disasters, etc.)
(1) Where a building, ship, motor vehicle, machinery, or equipment has been severely damaged or destroyed due to a natural disaster, loss by fire, collapse, or force majeure, and thus any of the following acquisitions is to be made within two years from the date of severe damage or destruction, acquisition tax thereon shall be exempted: Provided, That where the gross floor area of a newly acquired building, exceeds that of the previous building; where the tonnage of a newly constructed ship, of a ship converted to a different type of ship, or of a substitute ship acquired, exceeds that of the previous ship; or where the price of a newly acquired motor vehicle, machinery, or equipment, exceeds that (referring to the purchase price of new products) of the previous motor vehicle, machinery, or equipment, acquisition tax shall be imposed on such excess: <Amended by Act No. 13637, Dec. 29, 2015>
1. Where a building is constructed or repaired for restoration;
2. Where a ship is built or converted to a different type of ship;
3. Where a substitute building, ship, motor vehicle, machinery, or equipment, is acquired.
(2) Registration license tax shall be exempted on the registration of cancellation or on the enrollment of cancellation of a severely damaged or destroyed building, ship, motor vehicle, machinery, or equipment due to a natural disaster, loss by fire, collapse, or force majeure, and on a license for construction permit for new construction or repair within two years from the date of severe damage or destruction, to restore a severely damaged or destroyed building. <Amended by Act No. 10417, Dec. 27, 2010; Act No. 13637, Dec. 29, 2015>
(3) Motor vehicle tax shall be exempted on a motor vehicle recognized by the head of a Si/Gun, irretrievable or unusable because such motor vehicle has been misplaced, been severely damaged, or been destroyed due to a natural disaster, fire, traffic accident, etc. <Amended by Act No. 13637, Dec. 29, 2015>
 Article 92-2 (Tax Credits for Payment by Automatic Transfer, etc.)
(1) The following amounts shall be subtracted from the amount of local tax to be imposed pursuant to the Local Tax Act on a taxpayer who applies for the payment of local tax (excluding local taxes that are occasionally imposed and collected) under Article 35 (1) 3 of the Framework Act on Local Taxes by electronic service under Article 30 (1) of the same Act (hereafter in this Article, referred to as "payment by electronic service") or by credit card under Article 23 of the Local Tax Collection Act or automatic credit transfer under Article 24 of the same Act (hereafter in this Article, referred to as "payment by automatic transfer"), by no later than the end of the month before the month in which the payment deadline falls: <Amended by Act No. 14476, Dec. 27, 2016; Act No. 15295, Dec. 26, 2017>
1. Where he/she applies for payment by electronic service only or automated credit transfer only: Amount prescribed by municipal ordinance between 150 won and 500 won per tax notice;
2. Where he/she applies for both the payment by electronic service and payment by automatic transfer: Amount prescribed by municipal ordinance between 300 won and 1,000 won per tax notice.
(2) The tax credit prescribed in paragraph (1) shall be limited to the standard amount of small debts uncollectable under the Local Tax Act among the amount of local tax to be imposed pursuant to the same Act.
(3) Where a person granted the tax credit pursuant to paragraph (1) fails to pay the local tax by the payment deadline, the amount of the tax credit granted shall be collected as a penalty.
[This Article Newly Inserted by Act No. 10417, Dec. 27, 2010]
 Article 92-3 Former Article 92-3 Moved to Article 47-4 <by Act No. 12955, Dec. 31, 2014>
CHAPTER III SPECIAL PROVISIONS ON LOCAL INCOME TAXES
SECTION 1 Credit, Reduction, and Exemption of Global Income Tax
 Article 93 (Tax Credit for Bookkeeping)
(1) Where a person subject to simple bookkeeping under Article 160 (3) of the Income Tax Act enters and calculates the amount of income according to double-entry bookkeeping, and submits the documents pursuant to Article 70 (4) 3 of the Income Tax Act, when filing a final return on the tax base pursuant to Article 95 of the Local Tax Act, the equivalent of 20/100 of the amount calculated by multiplying the ratio of business income calculated according to the relevant book of account to global income by the amount of individual local income tax calculated on global income (hereinafter referred to as "amount of individual local income tax calculated on global income"), shall be deducted from the amount of individual local income tax calculated on global income: Provided, That where the amount of the tax credit exceeds 100,000 won, 100,000 won shall be deducted.
(2) No tax credit prescribed in paragraph (1) (hereinafter referred to as "tax credit for bookkeeping"), shall apply to any of the following cases:
1. Where a person files a return on his/her income omitting at least 20/100 of his/her income to be reported according to the book of account kept and recorded;
2. Where a person fails to keep the books of account and evidential documents concerning the tax credit for bookkeeping for five years from the end of the period for a final return on the tax base: Provided, That this shall not apply in extenuating circumstances prescribed by Presidential Decree, such as a natural disaster.
(3) Matters necessary for the tax credit for bookkeeping shall be prescribed by Presidential Decree.
[This Article Newly Inserted by Act No. 12175, Jan. 1, 2014]
 Article 94 (Tax Credit for Wages and Salary Incomes)
(1) For a resident or non-resident with wage and salary income, the following amount shall be deducted from the assessed individual local income tax on global income taxation on the relevant wage and salary income: <Amended by Act No. 12506, Mar. 24, 2014; Act No. 12955, Dec. 31, 2014; Act No. 14477, Dec. 27, 2016>
Assessed individual local income tax on global income on wage and salary incomeAmount of credit
Not exceeding 130,000 won55/100 of the calculated tax
Over 130,000 won71,500 won + 30/100 of the excess of 130,000 won
(2) Notwithstanding paragraph (1), where the tax deduction exceeds the amount classified as follows, such excess shall be deemed written off: <Newly Inserted by Act No. 12506, Mar. 24, 2014; Act No. 14477, Dec. 27, 2016>
1. Where the total pay does not exceed 33 million won: 74,000 won;
2. Where the total pay exceeds 33 million won, but does not exceed 70 million won: 74,000 won - [(total pay - 33 million won) x 8/10,000]: Provided, That if the above amount is less than 66,000 won, it shall be 66,000 won;
3. Where the total pay exceeds 70 million won: 66,000 won - [(total pay - 70 million won) x 1/20]: Provided, That if the above amount is less than 50,000 won, it shall be 50,000 won.
[This Article Newly Inserted by Act No. 12175, Jan. 1, 2014]
 Article 95 (Dividend Tax Credit)
(1) If any dividend income to which the proviso to the main sentence of Article 17 (3) of the Income Tax Act applies, is included in global income of a resident or non-resident, the equivalent of 10/100 of the amount added to the total income in the relevant taxable period, shall be deducted from the assessed individual local income tax on global income pursuant to the proviso to the main sentence of the same paragraph. <Amended by Act No. 12955, Dec. 31, 2014>
(2) Deduction made under paragraph (1) shall be referred to as "dividend tax credit."
(3) Dividend income eligible for dividend tax credit for the purposes of paragraph (1), shall be the dividend income included in the tax base of global income prescribed in Article 14 (2) of the Income Tax Act, exceeding the standard amount of global taxation on any interest income, etc.
(4) Matters necessary for calculating, etc. the dividend tax credit shall be prescribed by Presidential Decree.
[This Article Newly Inserted by Act No. 12175, Jan. 1, 2014]
 Article 96 (Tax Credit for Casualty Loss)
(1) Where a business operator is deemed to lack means to pay taxes, due to asset loss, by a natural disaster or any other accident (hereinafter referred to as "disasters"), equivalent to at least 20/100 of the amount of total assets prescribed by Presidential Decree (hereafter in this paragraph, referred to as "amount of total assets") in the relevant taxable period, the amount calculated (within the value of assets lost) by multiplying the following amount of individual local income tax (referring to the amount of individual local income tax on business income; hereafter in this Article, the same shall apply) in proportion (hereafter in this Article, referred to as "asset loss ratio") to the value of such loss, to the total assets before the loss, shall be deducted from such amount of tax. In such cases, the value of land shall not be included in the value of assets:
1. Individual local income tax being income tax not levied as at the date a disaster occurs and income tax levied but yet unpaid (including any penalty surcharge);
2. Individual local income tax on income in the taxable period attributable to the date a disaster occurs.
(2) In cases falling under paragraph (1), when any tax is to be deducted pursuant to Article 93, 95, or 97, paragraph (1) shall apply to individual local income tax after deducting such amount of tax.
(3) Deduction made under paragraph (1) shall be referred to as "tax credit for casualty loss."
(4) Any person who intends to be granted a tax credit for casualty loss may file an application with the head of a local government having jurisdiction over the place for tax payment, as prescribed by Presidential Decree: Provided, That where the application for a tax credit for casualty loss is filed with the head of a tax office having jurisdiction over the place for tax payment pursuant to Article 58 of the Income Tax Act, it shall be deemed that the application for a tax credit on individual local income tax is also applied. <<Period of Validity of Proviso: Dec. 31, 2016>>
(5) When the head of a local government having jurisdiction over the place for tax payment receives an application under paragraph (4), he/she shall determine the amount of tax to be deducted and notify the applicant thereof.
(6) Paragraph (1) shall apply even when no application is made under paragraph (4).
(7) Where disasters occur consecutively, paragraph (1) shall apply according to the asset loss ratio investigated and determined by the head of a local government having jurisdiction over the place for tax payment, as prescribed by Presidential Decree.
(8) Matters necessary for a tax credit for casualty loss shall be prescribed by Presidential Decree.
[This Article Newly Inserted by Act No. 12175, Jan. 1, 2014]
 Article 97 (Foreign Tax Credit, etc. for Global Income)
(1) Where any foreign source income is included in global income or retirement income of a resident, if he/she has paid or is to pay foreign income tax prescribed by Presidential Decree on such foreign source income in a foreign country, and has deducted it from the amount of tax calculated on global income or retirement income under Article 57 (1) 1 of the Income Tax Act, he/she may be eligible to deduct the equivalent of 10/100 of such deducted amount from the amount of individual local income tax calculated on global income or on retirement income: Provided, That the main sentence hereof shall not apply where the resident has handled the matter pursuant to Article 57 (1) 2 of the Income Tax Act.
(2) Where the equivalent of 10/100 of the foreign income tax paid or payable to a foreign government for the purposes of paragraph (1), exceeds 10/100 of the credit limit under Article 57 (1) 1 of the Income Tax Act, such excess may be carried forward to the taxable period to be completed within five years from the taxable period following the relevant taxable period, and deducted within the credit limit for the taxable period to which it is carried forward.
(3) Where a foreign country has imposed capital gains tax on overseas assets, if the amount of paid tax is deducted against the capital gains pursuant to Article 118-6 (1) 1 of the Income Tax Act, the relevant person shall be eligible to deduct the equivalent of 10/100 of such deducted amount from the amount of individual local income tax calculated on capital gains.
(4) Matters necessary for the tax credit, etc. under paragraphs (1) through (3) shall be prescribed by Presidential Decree.
[This Article Newly Inserted by Act No. 12175, Jan. 1, 2014]
 Article 97-2 (Child Tax Credit)
(1) With respect to children eligible for basic deduction, of a resident with global income (including adoptees and foster children), the amount classified as follows shall be deducted from the amount of individual local income tax calculated on global income: <Amended by Act No. 14477, Dec. 27, 2016>
1. For one child: 15,000 won a year;
2. For two children: 30,000 won a year;
3. For at least three children: An amount calculated by adding 30,000 won a year per child exceeding two persons to 30,000 won a year.
(2) If the number of children eligible for deduction, who are aged six or less, is at least two, 15,000 won a year per child exceeding one person shall be deducted from the amount of individual local income tax calculated on global income. <Newly Inserted by Act No. 14477, Dec. 27, 2016>
(3) If any children eligible for deduction, are born or reported as adopted during the relevant taxable period, the amount classified as follows shall be deducted from the amount of individual local income tax calculated on global income: <Newly Inserted by Act No. 14477, Dec. 27, 2016>
1. If a child born or reported as adopted, is the first child: 30,000 won a year;
2. If a child born or reported as adopted, is the second child: 50,000 won a year;
3. If a child born or reported as adopted, is the third child or a child thereafter: 70,000 won a year.
(4) The deductions prescribed in paragraphs (1) through (3) shall be referred to as "child tax credit." <Newly Inserted by Act No. 14477, Dec. 27, 2016>
[This Article Newly Inserted by Act No. 12506, Mar. 24, 2014]
 Article 97-3 (Tax Credit for Pension Account)
(1) The equivalent to 12/1,000 of the amount excluding the following amounts from that deposited in a pension account (hereinafter referred to as "amount deposited in a pension account") of a resident or non-resident with global income, shall be deducted from the amount of individual local income tax calculated on global income in the relevant taxable period: Provided, That where the amount deposited in a pension account exceeds four million won a year, such excess shall be written off; and where the amount calculated by adding the amount not exceeding four million won deposited in an annuity savings account and the amount deposited in a retirement pension account, exceeds seven million won a year, such excess shall be written off: <Amended by Act No. 12955, Dec. 31, 2014>
1. Taxation-deferred income, such as retirement income from which no income tax has been withheld as prescribed in Article 146 (2) of the Income Tax Act;
2. Amount paid by transferring a pension account contract to another pension account contract.
(2) The deduction prescribed in paragraph (1) shall be referred to as "tax credit for pension account."
(3) Deleted. <by Act No. 12955, Dec. 31, 2014>
(4) Matters necessary for the procedures, etc. for application for a tax credit for pension accounts, shall be prescribed by Presidential Decree.
[This Article Newly Inserted by Act No. 12506, Mar. 24, 2014]
 Article 97-4 (Special Tax Deduction)
(1) Where any resident with wage and salary income (excluding a daily employed worker; hereafter in this Article, the same shall apply), pays the following insurance premiums in the relevant taxable period for an insurance contract under which the insurance premiums to be refunded at maturity do not exceed the premiums paid, the equivalent of 12/1,000 (or 15/1,000 in cases falling under subparagraph 1) of such amount shall be deducted from the amount of individual local income tax calculated on global income in the relevant taxable period: Provided, That where the total of each of the following relevant premiums, exceeds one million won a year, respectively, such excess shall be written off, as relevant: <Amended by Act No. 14477, Dec. 27, 2016>
1. Premiums of a guaranty insurance exclusively for persons with disabilities prescribed by Presidential Decree, as an insurance exclusively for persons with disabilities, the insured or a beneficiary thereby is a person with a disability entitled to a basic deduction;
2. Premiums prescribed by Presidential Decree (excluding premiums of a guaranty insurance exclusively for persons with disabilities prescribed in subparagraph 1), the insured thereby are the persons entitled to a basic deduction.
(2) Where a resident with wage and salary income pays medical expenses prescribed by Presidential Decree, for persons entitled to a basic deduction (exempt from age and income limits) in the relevant taxable period, the equivalent of 15/1,000 of the following amounts shall be deducted from the amount of individual local income tax calculated on global income in the relevant taxable period: <Amended by Act No. 12955, Dec. 31, 2014>
1. The excess of the amount calculated by multiplying the total pay by 3/100, as medical expenses (excluding medical expenses prescribed in subparagraph 2) paid for persons entitled to a basic deduction: Provided, That where such amount exceeds seven million won a year, it shall be seven million won a year;
2. Medical expenses and subfertility treatment expenses prescribed by Presidential Decree paid for the relevant resident, a person who is at least 65 years old as at the end of the taxable period, or a person with a disability: Provided, That where medical expenses prescribed in subparagraph 1, are less than the amount calculated by multiplying the total pay by 3/100, such shortfall shall be deducted.
(3) Where a resident with wage and salary income has paid educational expenses prescribed by Presidential Decree, for such resident and a person entitled to a basic deduction (exempt from age limit, but applicable only to a person less than 18 years old as at the end of the taxable period, in cases of institutions prescribed in subparagraph 3 (b)) in the relevant taxable period, the equivalent of 15/1,000 of the following amounts shall be deducted from the amount of individual local income tax calculated on global income in the relevant taxable period: Provided, That no educational expenses prescribed by Presidential Decree as those entitled to exemption of income tax or gift tax, shall be deducted: <Amended by Act No. 12955, Dec. 31, 2014; Act No. 14477, Dec. 27, 2016>
1. The total of the following educational expenses paid for a spouse, lineal descendent, brother and sister, adoptee, and foster child entitled to a basic deduction: Provided, That educational expenses paid to a graduate school or paid with a student loan referred to in subparagraph 2 (d) shall be excluded; and the limit shall be nine million won a year per person in cases of university students and three million won a year per person in cases of preschool children and elementary school, secondary school, and high school students:
(a) Educational expenses paid to schools prescribed in the Early Childhood Education Act, the Elementary and Secondary Education Act, the Higher Education Act, and other special Acts;
(b) Educational expenses paid to any of the following life-long educational institutions or courses:
(i) A school-type lifelong educational establishment, graduates of which are recognized as having graduated from no higher than a senior high school prescribed in Article 31 (2) of the Lifelong Education Act;
(ii) A lifelong educational establishment which may use the name of the major college prescribed in Article 31 (4) of the Lifelong Education Act (hereinafter referred to as "major college");
(iii) An educational course prescribed by Presidential Decree (hereafter in this paragraph, referred to as "academic degree course") among distance lifelong educational establishments prescribed in Article 33 of the Lifelong Education Act (hereinafter referred to as "distance college");
(iv) An educational course prescribed by Presidential Decree (hereafter in this paragraph, referred to as "academic degree course") among courses of study accredited under Article 3 of the Act on Recognition of Credits, Etc. and courses prescribed in Article 5 (1) of the Act on the Acquisition of Academic Degrees through Self-Education;
(c) Educational expenses paid to overseas educational institutions prescribed by Presidential Decree (only applicable to students prescribed by Presidential Decree, where a resident who pays educational expenses for students enrolled in an overseas educational institution works in the Republic of Korea);
(d) Educational expenses paid to childcare centers prescribed in the Child Care Act, private teaching institutes prescribed in the Act on the Establishment and Operation of Private Teaching Institutes and Extracurricular Lessons, or sports facilities prescribed by Presidential Decree for preschool children (only applicable to the amount prescribed by Presidential Decree, in cases of expenses paid to private teaching institutes or sports facilities);
2. The total of the following educational expenses paid for the relevant resident:
(a) Educational expenses falling under subparagraph 1 (a) through (c);
(b) Educational expenses paid for courses of study equivalent to at least one semester at a university (including a major college, distance college, and academic degree course) or a graduate school, and for an hour-based program prescribed in Article 36 of the Higher Education Act;
(c) Tuition fees paid for vocational education and training conducted by a vocational education and training institution prescribed in Article 2 of the Act on the Development of Vocational Skills of Workers: Provided, That any subsidy, etc. prescribed by Presidential Decree received, shall be deducted;
(d) The amount of principal and interest redeemed of a student loan prescribed by Presidential Decree (excluding an amount additionally paid due to redemption in arrears);
3. Expenses for special education prescribed by Presidential Decree paid to any of the following persons, for persons with disabilities (exempt from the income limit) entitled to a basic deduction:
(a) Social welfare facilities and non-profit corporations prescribed by Presidential Decree;
(b) Institutions prescribed by Presidential Decree that provide development and rehabilitation services for the functional improvement and behavioral development of persons with disabilities;
(c) Overseas facilities or corporations, similar to those prescribed in item (a).
(4) Where any donation [including donations made by those falling under Article 50 (1) 2 and 3 (exempt from age limit) of the Income Tax Act (excluding those to whom the basic deduction of another resident is applied)] is made by a resident (excluding persons only with business income, but including persons prescribed by Presidential Decree, such as those falling under Article 73 (1) 4 of the Income Tax Act) in the relevant taxable period, the equivalent (hereafter in this Article, referred to as "tax credit for donation") of 15/1,000 (where the relevant amount exceeds 20 million won, 30/1,000 of the excess) of the amount calculated by deducting the amount of donation included in the necessary expenses when calculating the amount of business income from the aggregate of the following donations, shall be deducted from the amount of individual local income tax calculated on global income accumulatively imposed for the relevant taxable period (where any donation is included in the necessary expenses, excluding the amount of tax calculated on business income). In such cases, if the donations prescribed in subparagraphs 1 and 2 both are made, the donation prescribed in subparagraph 1 shall be deducted first; and where donations made as at December 31, 2013 are to be deducted from income by carrying forward to the taxable period that commences as of January 1, 2014, they shall be deducted prior to the deduction of the donations made in the relevant taxable period: <Amended by Act No. 12955, Dec. 31, 2014; Act No. 14477, Dec. 27, 2016>
1. Statutory donation;
2. Designated donation: In such cases, the maximum designated donation shall be classified as follows:
(a) Where any donations are made to religious organizations:
Maximum = [Referring to an amount calculated by deducting the amount of donation referred to in subparagraph 1 from the global income (excluding interest income and dividend income subject to withholding tax rates under Article 62 of the Income Tax Act); hereafter in this paragraph, referred to as "amount of income"] x 10/100 + (The lesser of 20/100 of the amount of income, and the amount paid to organizations other than religious organizations);
(b) In cases other than those prescribed in item (a):
Maximum = 30/100 of the amount of income.
(5) For the purposes of paragraphs (1) through (3), if any amount is already paid for a former spouse, a dependant, a person with a disability, or a person who is at least 65 years old as at the end of the taxable period, who ceases to be entitled to a basic deduction due to marriage, divorce, separation, employment, etc., before the end of the taxable period, the amount calculated by applying the rate prescribed in paragraphs (1) through (3), to the amount paid until the date the relevant ground arises, shall be deducted from the amount of individual local income tax calculated on global income in the relevant taxable period.
(6) Deductions made under paragraphs (1) through (4) shall apply where the relevant resident files an application therefor, as prescribed by Presidential Decree.
(7) and (8) Deleted. <by Act No. 12955, Dec. 31, 2014>
(9) For a person who fails to apply for income deduction or tax credit pursuant to paragraph (6) hereof, Article 52 (8) of the Income Tax Act, or Article 95-2 (2) of the Restriction of Special Taxation Act as a resident with wage and salary income, 13,000 won a year shall be deducted; a business operator who, meeting the requirements prescribed by Presidential Decree, such as reporting a business account prescribed in Article 160-5 (3) of the Income Tax Act (hereinafter referred to as "compliant business operator"), fails to apply for a tax credit under Article 122-3 of the Restriction of Special Taxation Act, 12,000 won a year shall be deducted; and for a person who has global income (excluding a compliant business operator) as a resident with no wage and salary income, 7,000 won a year shall be deducted (hereinafter referred to as "standard deduction"), from the amount of individual local income tax calculated on global income, respectively. <Amended by Act No. 12955, Dec. 31, 2014; Act No. 14477, Dec. 27, 2016>
(10) Deductions made under paragraphs (1) through (6) and (9) shall be construed as "special tax deduction." <Amended by Act No. 12955, Dec. 31, 2014>
(11) Other matters necessary for special tax deduction shall be prescribed by Presidential Decree.
[This Article Newly Inserted by Act No. 12506, Mar. 24, 2014]
 Article 98 (Tax Reduction or Exemption for Pay, etc. )
(1) When any of the following income is included in global income, the equivalent of the amount calculated by multiplying the amount of individual local income tax calculated on global income, by the ratio of the relevant wage and salary income or the relevant business income to the amount of global income, shall be reduced or exempted:
1. Pay received by a foreigner dispatched to the Republic of Korea under an agreement between the governments from the governments of both parties or the government of one party;
2. Income received by a resident non-Korean national from an overseas ship or airplane navigation business prescribed by Presidential Decree: Provided, That this shall only apply where the same exemption applies to ships or airplanes that a Korean national operates in the country of nationality of such resident, etc.
(2) Even where individual local income tax is reduced or exempted pursuant to any other statute, except as otherwise expressly provided for in such statute, the individual local income tax calculated by applying paragraph (1) mutatis mutandis, shall be reduced or exempted.
(3) Matters necessary for applying for tax reduction or exemption, etc. under paragraph (1), shall be prescribed by Presidential Decree. <Newly Inserted by Act No. 12506, Mar. 24, 2014>
[This Article Newly Inserted by Act No. 12175, Jan. 1, 2014]
SECTION 2 Special Provisions on Small or Medium Enterprises
 Article 99 (Tax Credit for Investment by Small or Medium Enterprises)
(1) Where a national operating a small or medium enterprise prescribed by Presidential Decree (hereinafter referred to as "small or medium enterprise") or a middle-standing enterprise prescribed by Presidential Decree, newly listed on the securities market under the Financial Investment Services and Capital Markets Act (hereafter in this Article, referred to as "securities market") for the first time (hereafter in this Article, referred to as "newly listed middle-standing enterprise") between January 1, 2015 and December 31, 2015, makes investment in any of the following assets (excluding any investment in used items or through lease prescribed by Presidential Decree) as at December 31, 2018 (in cases of a small or medium enterprise newly listed on the securities market for the first time (hereafter in this Article, referred to as "newly listed small or medium enterprise") and a newly listed middle-standing enterprise, in the taxable year in which the date of listing falls and until the taxable year that ends within three years from the date the following taxable year commences), the equivalent of 3/1,000 (or 4/1,000 in cases of a newly listed small or medium enterprise and a newly listed middle-standing enterprise) of the relevant investment, shall be deducted from the individual local income tax [limited to individual local income tax on business income (excluding income accrued from real estate leasing business under Article 45 (2) of the Income Tax Act; hereinafter the same shall apply except for Articles 166 and 172)] for the taxable year in which such investment is completed: <Amended by Act No. 14477, Dec. 27, 2016>
1. Business assets prescribed Presidential Decree including machinery and equipment (hereinafter referred to as "business assets");
2. Facilities for the point-of-sale data management system under the Distribution Industry Development Act (hereinafter referred to as "facilities for the point-of-sale data management system");
3. Facilities used in the information protection system under subparagraph 6 of Article 3 of the Framework Act on National Informatization, with the depreciation period of at least two years (hereinafter referred to as "facilities for the information protection system").
(2) Where any investment under paragraph (1) is made over at least two taxable years, paragraph (1) may apply to the amount invested in each relevant taxable year in which such investment is made.
(3) Matters necessary for calculating amounts invested under paragraph (2), shall be prescribed by Presidential Decree.
(4) A national who seeks application of paragraphs (1) and (2) shall apply for a tax credit, as prescribed by Presidential Decree.
[This Article Newly Inserted by Act No. 12175, Jan. 1, 2014]
 Article 100 (Tax Reduction or Exemption for Small or Medium Start-up Enterprises, etc.)
(1) A small or medium enterprise established in an area outside the overconcentration control district of the Seoul Metropolitan area (hereinafter referred to as "small or medium start-up enterprise") and a national designated as an operator of business incubator under Article 6 (1) of the Support for Small and Medium Enterprise Establishment Act, as at December 31, 2018, shall be granted a reduction of an amount of tax equivalent to 50/100 of individual local income tax on income generated from the relevant business in the taxable year in which the first income accrues from relevant business (where no income accrues from the relevant business by the taxable year falling on the fifth anniversary from the date the relevant business commences, the taxable year falling on the fifth anniversary) and also within the four subsequent taxable years from the beginning of the subsequent taxable year. <Amended by Act No. 14477, Dec. 27, 2016>
(2) Enterprises prescribed by Presidential Decree among venture businesses defined in Article 2 (1) of the Act on Special Measures for the Promotion of Venture Businesses (hereinafter referred to as "venture business"), certified as a venture business by no later than December 31, 2018, under Article 25 of the same Act within three years from establishment (hereinafter referred to as "small or medium start-up venture businesses"), shall be granted a reduction of an amount of tax equivalent to 50/100 of individual local income tax on income generated from the relevant business in the taxable year in which the first income accrues after such certification (where no income accrues from the relevant business by the taxable year falling on the fifth anniversary from the date it is certified as a venture business, the taxable year falling on the fifth anniversary) and also within the four subsequent taxable years from the beginning of the subsequent taxable year: Provided, That cases to which paragraph (1) applies shall be excluded, and where any of the following grounds exists during the period of reduction, reduction shall not be applicable from the taxable year in which the date classified as follows, falls: <Amended by Act No. 14477, Dec. 27, 2016>
1. Where the verification of a venture business is revoked: Date of revocation;
2. Where the term of validity of a certificate of a venture business under Article 25 (2) of the Act on Special Measures for the Promotion of Venture Businesses has expired (excluding where re-verification of a venture business is obtained as at the end of the relevant taxable year): Expiration date of the term of validity.
(3) The scope of small or medium start-up enterprises and small or medium start-up venture businesses, shall be small or medium enterprises operating the types of business prescribed under Article 6 (3) of the Restriction of Special Taxation Act. <Amended by Act No. 14477, Dec. 27, 2016>
(4) Small or medium enterprises, for which the taxable year in which the date of incorporation falls and subsequent three taxable years, have not passed, falling under new energy technology small or medium enterprises prescribed by Presidential Decree (hereinafter referred to as "new energy technology small or medium enterprises") as at December 31, 2015, shall be granted a reduction of an amount of tax equivalent to 50/100 of individual local income tax on income generated from the relevant business in the taxable year in which the first income accrues after falling under new energy technology small or medium enterprises (where no income accrues from the relevant business by the taxable year falling on the fifth anniversary from the date of falling under new energy technology small or medium enterprises, the taxable year falling on the fifth anniversary) and also within the four subsequent taxable years from the beginning of the subsequent taxable year: Provided, That cases to which paragraphs (1) and (2) are applicable shall be excluded herefrom, and where such enterprises cease to fall under the new energy technology small or medium enterprises during the period of reduction, such enterprises shall not be granted a tax reduction from the taxable year in which such enterprises cease to fall under the new energy technology small or medium enterprises.
(5) For the purposes of paragraph (4), methods for calculating income generated from the relevant business, shall be prescribed by Presidential Decree.
(6) For the purposes of paragraphs (1) through (5), none of the following cases shall be deemed a new business startup: Provided, That subparagraph 3 shall not apply where a resurgent small or medium entrepreneur referred to in Article 99-6 (1) of the Restriction of Special Taxation Act starts a new business, or obtains designation or verification under this Article by no later than December 31, 2018: <Amended by Act No. 14477, Dec. 27, 2016>
1. Where a previous business is succeeded to by a merger, division, investment in kind, or acquisition of business or where a business of the same type is conducted through an acquisition or purchase of the assets used in the previous business: Provided, That where the assets used for the previous business are acquired or purchased to operate the same type of business and the ratio of the total value of the relevant assets to the total value of business assets prescribed by Presidential Decree, including land, buildings, and machinery, is less than 50/100 and falls short of the ratio determined by Presidential Decree, such cases shall be excluded;
2. Where a new corporation is incorporated by converting a business operated by a resident into a corporation;
3. Where a business of the same type as the one before its closure is conducted by re-starting a business after its closure;
4. Where it is difficult to deem that a new business has been started, as it involves expanding the existing business or adding another business line, etc.
(7) Where an enterprise to which reduction or exemption is granted pursuant to paragraph (1), (2), or (4), ceases to fall under a small or medium enterprise on the grounds prescribed by Presidential Decree, such as merging with an enterprise which is not a small or medium enterprise under the Framework Act on Small and Medium Enterprises, no reduction or exemption shall be granted from the taxable year in which the relevant grounds arise. <Amended by Act No. 14477, Dec. 27, 2016>
(8) A national who seeks application of paragraphs (1), (2), and (4) and a resurgent small or medium entrepreneur who seeks application of the proviso to paragraph (6), shall apply for tax reduction or exemption, as prescribed by Presidential Decree. <Amended by Act No. 14477, Dec. 27, 2016>
[This Article Newly Inserted by Act No. 12175, Jan. 1, 2014]
 Article 101 (Special Tax Reduction or Exemption for Small or Medium Enterprises)
(1) Any small or medium enterprise engaging in a type of business eligible for reduction or exemption under the following subparagraph 1, shall be allowed the reduction or exemption of the equivalent of the amount of tax calculated by multiplying the reduction or exemption ratio specified in subparagraph 2 by individual local income tax on income accrued from the relevant place of business until the taxable year ending as at December 31, 2017: <Amended by Act No. 14477, Dec. 27, 2016>
1. Types of business subject to tax reduction or exemption:
(a) Crop-cultivating business;
(b) Livestock business;
(c) Fishery business;
(d) Mining business;
(e) Manufacturing business;
(f) Sewage and waste disposal (including recycling), raw material recycling, and environmental restoration business;
(g) Construction business;
(h) Wholesale and retail business;
(i) Passenger transport business;
(j) Publishing business;
(k) Movie, video, and broadcasting program production business; movie, video, and broadcasting program production-related service business; movie, video, and broadcasting program distribution business; audio publishing and original recording business;
(l) Broadcasting business;
(m) Telecommunications business;
(n) Computer programming, system integration and management business;
(o) Information service business;
(p) Research and development business;
(q) Advertising business;
(r) Other scientific technology service business;
(s) Packaging and charging business;
(t) Specialized design business;
(u) Creation and art-related service business (excluding individual artists);
(v) Entrusted manufacturing business by OEM method prescribed by Presidential Decree;
(w) Engineering business;
(x) Logistics industry;
(y) Business operating private institutes teaching vocational skills under the Act on the Establishment and Operation of Private Teaching Institutes and Extracurricular Lessons or business operating vocational skill development training establishments under the Act on the Development of Vocational Skills of Workers (limited to where vocational skill development training is the principal business);
(z) Business operating a motor vehicle maintenance factory prescribed by Presidential Decree;
(za) Ship management business under the Marine Transportation Act;
(zb) Business operating a medical institution under the Medical Service Act (excluding clinics, dental clinics, and herb clinics; hereafter in this Article, referred to as "medical service business");
(zc) Tourist business under the Tourism Promotion Act (excluding casinos, tourist amusement restaurants, and amusement restaurants for exclusive use by foreigners);
(zd) Business operating welfare facilities for elderly persons under the Welfare of Older Persons Act;
(ze) Exhibition industry under the Act on the Development of Exhibition Industry;
(zf) Human resource supply and placement business (including business supplying agricultural laborers);
(zg) Call center and telemarketing service business;
(zh) Business performed by an enterprise specialized in energy saving under Article 25 of the Energy Use Rationalization Act;
(zi) Business operating a long-term domiciliary care institution under Article 32 of the Long-Term Care Insurance Act;
(zj) Business cleaning buildings and industrial facilities;
(zk) Security and escort business;
(zl) Market research and public opinion-polling business;
(zm) Social welfare service business;
(zn) Business leasing intangible property rights (limited to leasing of intellectual property defined in subparagraph 1 of Article 3 of the Framework Act on Intellectual Property);
(zp) Individual care worker and other similar service business, social educational facility, staff-training center, and other technical and vocational training institute, and library, historic site, and other similar leisure-related service business (excluding business operating reading rooms);
(zq) Housing rental management business under the Special Act on Private Rental Housing;
(zr) New and renewable energy power generation business under the Act on the Promotion of the Development, Use and Diffusion of New and Renewable Energy;
(zs) Security system service;
(zt) Forestry;
2. Tax reduction or exemption ratio:
(a) A place of business where a small enterprise prescribed by Presidential Decree (hereafter in this Article, referred to as "small enterprise") operates wholesale business, retail business, or medical service business (hereafter in this Article, referred to as "wholesale business, etc."): 10/100;
(b) A place of business where a small enterprise operates, with the exception of wholesale business, etc., the type of business subject to tax reduction or exemption referred to in subparagraph 1, in the Seoul Metropolitan area: 20/100;
(c) A place of business where a small enterprise operates, with the exception of wholesale business, etc., the type of business subject to tax reduction or exemption referred to in subparagraph 1, in an area other than the Seoul Metropolitan area: 30/100;
(d) A place of business where a medium enterprise, other than small enterprises, (hereafter in this Article, referred to as "medium enterprise"), operates wholesale business, etc., in an area other than the Seoul Metropolitan area: 5/100;
(e) A place of business where a medium enterprise operates knowledge-based business prescribed by Presidential Decree in the Seoul Metropolitan area: 10/100;
(f) A place of business where a medium enterprise operates, with the exception of wholesale business, etc., the type of business subject to tax reduction or exemption referred to in subparagraph 1, in an area other than the Seoul Metropolitan area: 15/100.
(2) Where a small or medium enterprise registered for car rental business pursuant to Article 28 of the Passenger Transport Service Act, owns electric vehicles defined in subparagraph 3 of Article 2 of the Act on Promotion of Development and Distribution of Environment-Friendly Motor Vehicles, the number of which is at least 50/100 of the total number of the commercial motor vehicles, it shall be granted a reduction of 30/100 of individual local income tax on income accrued from the relevant car rental business until December 31, 2019, notwithstanding paragraph (1). <Newly Inserted by Act No. 14477, Dec. 27, 2016>
(3) A national who seeks application of paragraph (1) or (2) shall apply for tax reduction or exemption, as prescribed by Presidential Decree. <Amended by Act No. 14477, Dec. 27, 2016>
[This Article Newly Inserted by Act No. 12175, Jan. 1, 2014]
 Article 101-2 (Tax Credit for Amount Paid in Mutually-Beneficial Settlement)
(1) Where a national operating a small or medium enterprise has ever paid a purchase price (referring to a purchase price under Article 7-2 (3) 1 of the Restriction of Special Taxation Act; hereafter in this Article, the same shall apply) through a mutually-beneficial settlement system prescribed by Presidential Decree (hereafter in this Article, referred to as "mutually-beneficial settlement system") among purchase prices paid to small or medium enterprises as at December 31, 2017, and fulfills each of the following requirements, the amount calculated pursuant to paragraph (2) shall be deducted from individual local income tax (limited to income tax on business income): Provided, That where the amount to be deducted exceeds 10/100 of individual local income tax for the relevant taxable year, the maximum deduction shall be 10/100 thereof:
1. The ratio of the amount of semi-cash settlement prescribed by Presidential Decree out of the purchase prices paid in the relevant taxable year, shall not have decreased as compared with the immediately preceding taxable year;
2. The amount of promissory notes paid for purchase prices in the relevant taxable year, shall not have increased as compared with the immediately preceding taxable year.
(2) The amount to be deducted pursuant to paragraph (1) shall be the aggregate of the amounts referred to in subparagraphs 1 and 2:
1. Amounts, the payment deadlines of which fall within 15 days from the dates of preparation of tax invoices, etc. (referring to tax invoices, etc. under Article 7-2 (1) 2 of the Restriction of Special Taxation Act; hereafter in this Article, the same shall apply) among the amounts paid through the mutually-beneficial settlement system x 2/10,000;
2. Amounts, the payment deadlines of which fall on a date exceeding 15 days but not exceeding 60 days from the date of preparation of tax invoices, etc. among the amounts paid through the mutually-beneficial settlement system x 1/10,000.
(3) A national who seeks application of paragraph (1) or (2) shall apply for reduction or exemption, as prescribed by Presidential Decree.
[This Article Newly Inserted by Act No. 14477, Dec. 27, 2016]
SECTION 3 Special Provisions on Research and Human Resources Development
 Article 102 (Tax Credit for Research and Human Resources Development Expenses)
(1) Where research and human resources development expenses are incurred by a national in each taxable year, 10/100 of an amount calculated by adding the following amounts, shall be deducted from individual local income tax (limited to individual local income tax on business income) for the relevant taxable year. In such cases, subparagraph 1 shall apply only to research and human resources development expenses incurred as at December 31, 2018: <Amended by Act No. 12506, Mar. 24, 2014; Act No. 12955, Dec. 31, 2014; Act No. 14477, Dec. 27, 2016>
1. As for research and development expenses in the field of new growth engine or for obtaining original technology prescribed by Presidential Decree (hereafter in this Article, referred to as "research and development expenses for new growth engine and original technology") among research and human resources development expenses, an amount calculated by multiplying research and development expenses for new growth engine and original technology incurred in the relevant taxable year, by the rates classified as follows:
(a) In cases of small or medium enterprises: 30/100;
(b) In cases other than small or medium enterprises: The rate calculated by the following formula (30/100 shall be the limit):
20/100 + (the ratio of research and development expenses for new growth engine and original technology to the revenue of the relevant taxable year x a specific multiple prescribed by Presidential Decree);
2. Deleted; <by Act No. 14477, Dec. 27, 2016>
3. In cases of research and human resources development expenses of a national not falling under subparagraph 1, or not selecting subparagraph 1 (hereafter in this Article, referred to as "general research and human resources development expenses"), the equivalent of any of the following items that he/she selects: Provided, That an amount falling under item (b) where general research and human resources developments expenses are not incurred within the four years preceding the date the relevant taxable year commences or where general research and human resources developments expenses incurred in the immediately preceding taxable year, are less than the average annual amount of general research and human resources development expenses incurred for four years preceding the date the relevant taxable year commences:
(a) Where general research and human resources development expenses incurred in the relevant taxable year, exceed general research and human resources development expenses incurred in the immediately preceding taxable year, the equivalent of 40/100 of such excess (or 50/100 in cases of small or medium enterprises);
(b) An amount calculated by multiplying general research and human resources development expenses incurred in the relevant taxable year, by the rate classified as follows:
(i) In cases of small or medium enterprises: 25/100;
(ii) Where a small or medium enterprise first ceases to fall under a small or medium enterprise, as prescribed by Presidential Decree: Rates classified as follows:
a. From the date the taxable year during which it first ceases to fall under a small or medium enterprise, until the taxable year which ends within three year thereafter: 15/100;
b. Until the taxable year that ends within two years since the period referred to in a.: 10/100;
(iii) Where a middle-standing enterprise prescribed by Presidential Decree (hereinafter referred to as "middle-standing enterprise") does not fall under (ⅱ): 8/100;
(iv) Cases not falling under any of (i) through (iii): The rate calculated by the following arithmetic formula (3/100 shall be the limit):
2/100 + percentage of general research and human resources development expenses to revenues in the relevant taxable year x 1/2.
(2) The classification and calculation of the annual average of general research and human resources development expenses incurred during four preceding years under paragraph (1) 3, and other necessary matters, shall be prescribed by Presidential Decree.
(3) A national who seeks application of paragraph (1) shall apply for a tax credit, as prescribed by Presidential Decree.
(4) A national who seeks application of paragraph (1) 1 shall keep separate accounts of general research and human resources development expenses; research and development expenses for new growth engine and original technology, as prescribed by Presidential Decree. <Amended by Act No. 14477, Dec. 27, 2016>
[This Article Newly Inserted by Act No. 12175, Jan. 1, 2014]
 Article 103 (Tax Credit for Investment in Facilities for Research and Human Resources Development)
(1) Where a national makes investment in facilities for research and human resources development (excluding any investment in used facilities and through leases prescribed by Presidential Decree) by no later than December 31, 2018, the equivalent of 1/1,000 (or 3/1,000 in cases of a middle-standing enterprise prescribed by Presidential Decree, and 6/1,000 in cases of a small or medium enterprise) of such amount invested, shall be allowed to be deducted from his/her individual local income tax (limited to individual local income tax on business income) for the taxable year in which such investment is completed. <Amended by Act No. 14477, Dec. 27, 2016>
(2) "Facilities for research and human resources development" in paragraph (1), means any of the following: <Amended by Act No. 14477, Dec. 27, 2016>
1. Facilities for research and experimenting prescribed by Presidential Decree;
2. Facilities for vocational training prescribed by Presidential Decree;
3. Deleted. <by Act No. 14477, Dec. 27, 2016>
(3) Where the investment under paragraph (1) is made over at least two taxable years, paragraph (1) may apply to each amount invested for each taxable year in which such investment is made.
(4) Matters necessary for calculating the amount invested under paragraph (3) shall be prescribed by Presidential Decree.
(5) A national who seeks application of paragraph (1) or (3) shall apply for a tax credit, as prescribed by Presidential Decree.
[This Article Newly Inserted by Act No. 12175, Jan. 1, 2014]
 Article 104 (Special Taxation for Income from Technology Transfer, etc.)
(1) As for any income accrued by a small or medium enterprise or a middle-standing enterprise prescribed by Presidential Decree from the transfer (excluding transfer to a related party prescribed by Presidential Decree) of a patent right, utility model, confidential know-how, or technology prescribed by Presidential Decree (hereafter in this Article, referred to as "patent right, etc.") researched and developed autonomously by itself, to a national by no later than December 31, 2018, an amount of tax equivalent to 50/100 of the individual local income tax on the relevant income, shall be reduced. <Amended by Act No. 14477, Dec. 27, 2016>
(2) Where a national obtains patent rights, etc. by no later than December 31, 2018, from a national who has autonomously researched and developed patent rights, etc. (excluding where such patent right, etc. is obtained from a related party prescribed by Presidential Decree), an amount calculated by multiplying the acquisition cost by a rate classified as follows, shall be deducted from individual local income tax (limited to individual local income tax on business income) for the relevant taxable year. In such cases, the deductible amount shall not exceed 10/100 of the individual local income tax for the relevant taxable year: <Amended by Act No. 14477, Dec. 27, 2016>
1. Where a small or medium enterprise obtains patent rights, etc.: 10/100;
2. Where a national other than a small or medium enterprise, obtains patent rights, etc.: 5/100 (limited to where he/she obtains patent rights, etc. from a small or medium enterprise).
(3) Individual local income tax shall be reduced by 25/100 on income accrued by a small or medium enterprise from lending patent rights, etc. until December 31, 2018 (excluding where they are lent to a related party prescribed by Presidential Decree). <Newly Inserted by Act No. 14477, Dec. 27, 2016>
(4) A national who seeks application of paragraphs (1) through (3) shall apply for tax reduction or exemption or for a tax credit, as prescribed by Presidential Decree. <Amended by Act No. 14477, Dec. 27, 2016>
[This Article Newly Inserted by Act No. 12175, Jan. 1, 2014]
 Article 105 (Reduction or Exemption of Individual Local Income Tax, etc. for High-Tech Enterprises, etc. Moving to Special Research and Development Zones)
(1) Where any of the following enterprises located in a special research and development zone defined in subparagraph 1 of Article 2 of the Special Act on Promotion of Special Research and Development Zones, engages in business prescribed by Presidential Decree, such as in the biotech industry or information and communications industry (hereafter in this Article, referred to as "business entitled to reduction or exemption") at the place of business located in the relevant zone (hereafter in this Article, referred to as "place of business entitled to reduction or exemption"), the individual local income tax shall be reduced or exempted, as prescribed in paragraphs (2) through (6): <Amended by Act No. 14477, Dec. 27, 2016>
1. A high-tech enterprise designated by no later than December 31, 2018, pursuant to Article 9 (1) of the Special Act on Promotion of Special Research and Development Zones;
2. A research institute-run enterprise registered by no later than December 31, 2018, pursuant to Article 9-3 (2) of the Special Act on Promotion of Special Research and Development Zones.
(2) With respect to income generated from business entitled to reduction or exemption, operated by an enterprise which meets the requirements referred to in paragraph (1), the equivalent of 100/100 of the individual local income tax for the taxable year ending within three years after the beginning of the taxable year in which the first income accrues from the said business (if no income accrues from the said business until the taxable year falling on the fifth anniversary from the date of such designation or registration, the taxable year falling on the fifth anniversary), and the equivalent of 50/100 of the individual local income tax for the taxable year ending within two years thereafter, shall be reduced or exempted, respectively.
(3) Where the total of the individual local income tax reduced or exempted during the period of reduction or exemption to which paragraph (2) applies, exceeds the aggregate of amounts prescribed in subparagraphs 1 and 2, the amount of tax shall be reduced or exempted by up to the ceiling of such aggregate (hereafter in this Article, referred to as "reduction or exemption ceiling"): Provided, That where the enterprise operates a service business prescribed by Presidential Decree (hereafter in this Article, referred to as "service business") and the aggregate of the income tax or corporate tax reduced or exempted for income accrued from the relevant service business during the period of reduction or exemption to which paragraph (2) applies, exceeds the greater of the aggregate of the amounts prescribed in subparagraphs 1 and 2, and of the amount prescribed in subparagraph 3, the amount of tax may be reduced or exempted by up to such greater amount: <Amended by Act No. 14477, Dec. 27, 2016>
1. 5/100 of the cumulative investments prescribed by Presidential Decree;
2. The lesser of the following amounts:
(a) The number of workers at ordinary times in the relevant taxable year at the place of business entitled to reduction or exemption x one million won;
(b) 2/100 of the cumulative investments under subparagraph 1;
3. The lesser of the following amounts:
(a) The number of workers at ordinary times in the relevant taxable year at the place of business entitled to reduction or exemption x two million won;
(b) 10/100 of the cumulative investments under subparagraph 1.
(4) When applying the reduction or exemption ceiling to the individual local income tax to be reduced or exempted in each taxable year pursuant to paragraph (2), the amount under paragraph (3) 1 shall be applied first and then the amount under paragraph (3) 2 shall be applied.
(5) Where the number of workers at ordinary times each taxable year at the place of business entitled to a reduction or exemption during the period from the end of the taxable year in which the tax reduction or exemption was granted, until the end of the taxable year falling on the second anniversary from the end of the taxable year in which the tax reduction or exemption was granted, has decreased as compared with the number of workers at ordinary times in the taxable year in which the tax credit was granted, an enterprise that has its individual local income tax reduced or exempted under paragraph (3) 2 or 3, shall pay the equivalent of the amount of tax reduced or exempted as individual local income tax, as prescribed by Presidential Decree. <Amended by Act No. 14477, Dec. 27, 2016>
(6) For the purposes of paragraphs (3) and (5), the scope of workers at ordinary times, method for calculating the number of workers at ordinary times, and other necessary matters, shall be prescribed by Presidential Decree.
(7) Any person who seeks application of paragraph (2) shall apply for reduction or exemption, as prescribed by Presidential Decree.
(8) Where the reduction or exemption ceiling applies pursuant to the proviso to paragraph (3), the relevant enterprise shall keep separate accounts of service business and other types of business, by applying mutatis mutandis Article 143 of the Restriction of Special Taxation Act. <Newly Inserted by Act No. 14477, Dec. 27, 2016>
[This Article Newly Inserted by Act No. 12175, Jan. 1, 2014]
 Article 106 (Reduction or Exemption of Individual Local Income Tax for Foreign Engineers)
(1) A foreign engineer prescribed by Presidential Decree shall be granted a tax reduction equivalent to 50/100 of the individual local income tax on the earned income derived from the services provided to a national within Korea, received until the month falling on the second anniversary from the date (applicable only to the period until December 31, 2018) such foreign engineer began providing his/her services in Korea, falls. <Amended by Act No. 12955, Dec. 31, 2014>
(2) Deleted. <by Act No. 12955, Dec. 31, 2014>
(3) Any person who seeks application of paragraph (1) shall apply for reduction or exemption, as prescribed by Presidential Decree. <Amended by Act No. 12955, Dec. 31, 2014>
[This Article Newly Inserted by Act No. 12175, Jan. 1, 2014]
 Article 106-2 (Special Taxation for Foreign Workers)
For foreign workers subject to Article 18-2 (2) of the Restriction of Special Taxation Act (including transitional measures under Article 59 of the Addenda to the Restriction of Special Taxation Act (Act No. 12173)), the tax rate equivalent to 10/100 of the income tax rate prescribed in Article 18-2 (2) of the Restriction of Special Taxation Act shall apply, notwithstanding Article 92 (1) of the Local Tax Act. In such cases, the provisions of this Act concerning the tax credit and reduction and exemption of tax related to individual local income tax, shall not apply.
[This Article Newly Inserted by Act No. 12506, Mar. 24, 2014]
SECTION 4 Special Provisions on International Capital Transactions
 Article 107 (Special Taxation for Introduction of Public Loans)
(1) The individual local income tax on royalties or service fees paid to any foreigner in connection with the introduction of a public loan defined in subparagraph 6 of Article 2 of the Introduction and Management of Public Loans Act, shall be reduced or exempted as prescribed by the relevant public loan agreement (referring to a public loan agreement defined in subparagraph 7 of Article 2 of the same Act).
(2) Reduction or exemption of an amount of individual local income tax under paragraph (1) may be denied if so requested by a lender defined in under subparagraph 10 of Article 2 of the Introduction and Management of Public Loans Act, or a technology licensor.
[This Article Newly Inserted by Act No. 12175, Jan. 1, 2014]
 Article 108 (Exemption from Individual Local Income Tax on Interest Income, etc. from International Financial Transactions)
(1) A person who is paid any of the following income (excluding residents' domestic business places), shall be exempted from individual local income tax: <Amended by Act No. 12955, Dec. 31, 2014>
1. Interest and commission on the foreign currency bonds issued overseas by the State, a local government, or a domestic corporation;
2. Interest and commission paid on the foreign currency receivables recoverable in foreign currency, which a foreign exchange business handling institution under the Foreign Exchange Transactions Act, borrows from a foreign financial institution to conduct the foreign exchange business as prescribed by the same Act;
3. Interest and commission paid on the foreign currency bills or foreign currency deposit certificates issued or sold overseas by finance companies, etc. prescribed by Presidential Decree, as prescribed by the Foreign Exchange Transactions Act.
(2) Any income accrued from an overseas transfer by a non-resident of the securities prescribed by Presidential Decree, issued by the State, a local government, or a domestic corporation, shall be exempted from individual local income tax.
[This Article Newly Inserted by Act No. 12175, Jan. 1, 2014]
SECTION 5 Special Provisions on Investment Promotion
 Article 109 (Tax Credit for Investing, etc. in Facilities for Increasing Productivity)
(1) Where a national invests in any of the following facilities (excluding investing in used facilities and through leases prescribed by Presidential Decree) by no later than December 31, 2017, to increase productivity, the equivalent of 3/1,000 of such amount invested (or 5/1,000 in cases of a middle-standing enterprise prescribed by Presidential Decree; and 7/1,000 in cases of a small or medium enterprise), shall be deducted from his/her individual local income tax (limited to individual local income tax on business income): <Amended by Act No. 14477, Dec. 27, 2016>
1. Facilities for improving and automating processes, prescribed by Presidential Decree;
2. High-technology equipment prescribed by Presidential Decree;
3. Computers and peripherals, software, telecommunications facilities, and other tangible and intangible facilities, used to manage the supply chain, including material procurement, production planning, and inventory management, in electronic format, with the depreciation period of at least two years (hereinafter referred to as "facilities for supply chain management system");
4. Computers and peripherals, software, telecommunications facilities, and other tangible and intangible facilities, used to manage customer relationship, including integrating and analyzing data on customers and marketing, in electronic format, with the depreciation period of at least two years (hereinafter referred to as "facilities for customer relationship management system");
5. Computers and peripherals, software, telecommunications facilities, and other tangible and intangible facilities, used to strategically and efficiently manage logistics processes, including purchasing, management of orders, transportation, production, warehouse management, inventory management, and distribution network, with the depreciation period of at least two years;
6. Systems prescribed by Presidential Decree, such as knowledge management systems to systematize and share knowledge possessed by the executives or employees hired by nationals.
(2) Where any small or medium enterprises use, via the Internet, facilities falling under paragraph (1) 3 and 4, owned by another person by no later than December 31, 2017, to increase its productivity, the equivalent of 7/1,000 of their usage fees shall be deducted from its individual local income tax (limited to individual local income tax on business income). <Amended by Act No. 14477, Dec. 27, 2016>
(3) Article 103 (1), (3), and (4) shall apply mutatis mutandis to the methods for granting a tax credit under paragraph (1) or (2).
(4) A national who seeks application of paragraphs (1) and (2) shall apply for a tax credit, as prescribed by Presidential Decree.
[This Article Newly Inserted by Act No. 12175, Jan. 1, 2014]
 Article 110 (Tax Credit for Investing, etc. in Safety Facilities)
(1) Where a national invests, by no later than December 31, 2017, in facilities prescribed by Presidential Decree (excluding investing in used facilities and through leases prescribed by Presidential Decree) as deemed necessary for the purposes of industrial policies and safety policies, falling under any of the following facilities (in cases falling under subparagraph 1, including items; hereafter in this Article, the same shall apply), the equivalent of 3/1,000 [or 5/1,000 in cases of a middle-standing enterprise prescribed by Presidential Decree; and 7/1,000 in cases of a small or medium enterprise (or 10/1,000, where a small or medium enterprise invests in the facilities stipulated in subparagraph 7)] of such amount invested, shall be deducted from the individual local income tax (limited to individual local income tax on business income). In such cases, Article 103 (1), (3), and (4) shall apply mutatis mutandis to the methods for granting a tax credit: <Amended by Act No. 14477, Dec. 27, 2016>
1. Facilities for distribution business to be operated under the Distribution Industry Development Act;
1-2. Fire-fighting systems defined in Article 2 of the Act on Fire Prevention and Installation, Maintenance, and Safety Control of Fire-Fighting Systems (excluding fire-fighting systems to be installed in specific fire-fighting objects pursuant to Article 9 of the same Act) and other fire-fighting-related items prescribed by Presidential Decree;
1-3. Seismic retrofit facilities;
2. Facilities installed in a trustee company by a truster company under the Act on the Promotion of Collaborative Cooperation between Large Enterprises and Small-Medium Enterprises;
3. Industrial disaster prevention facilities;
4. Mining safety facilities;
5. Facilities reinforced or expanded by an individual designated as person under priority management under the Emergency Resources Management Act, to perform his/her emergency preparedness duties in compliance with the Government's order to reinforce and expand such facilities;
6. Facilities for preventing hazardous elements, installed by a relevant business operator subject to the Hazard Analysis Critical Control Point under Article 9 of the Livestock Products Sanitary Control Act or Article 48 of the Food Sanitation Act;
7. Facilities installed to prevent technology from being illegally transferred;
8. Facilities installed to develop overseas resources.
(2) A national who seeks application of paragraph (1) shall apply for a tax credit, as prescribed by Presidential Decree.
[This Article Newly Inserted by Act No. 12175, Jan. 1, 2014]
 Article 111 (Tax Credit for Investing in Energy-Saving Facilities)
(1) Where a national invests (excluding investing made in used facilities and through leases prescribed by Presidential Decree) in energy-saving facilities prescribed by Presidential Decree by no later than December 31, 2019, the equivalent of 1/1,000 (or 3/1,000 in cases of a middle-standing enterprise prescribed by Presidential Decree; and 6/1,000 in cases of a small or medium enterprise) of the relevant amount invested, shall be deducted from the individual local income tax (limited to individual local income tax on business income). <Amended by Act No. 12506, Mar. 24, 2014; Act No. 14477, Dec. 27, 2016>
(2) For the purposes of paragraph (1), Article 103 (1), (3), and (4) shall apply mutatis mutandis to the methods for granting a tax credit.
(3) A national who seeks application of paragraph (1) shall apply for a tax credit, as prescribed by Presidential Decree.
[This Article Newly Inserted by Act No. 12175, Jan. 1, 2014]
 Article 112 (Tax Credit for Investing in Facilities for Environmental Conservation)
(1) Where a national invests (excluding investing in used facilities and through leases prescribed by Presidential Decree) in any facility for environmental conservation prescribed by Presidential Decree by no later than December 31, 2019, the equivalent of 3/1,000 (or 5/1,000 in cases of a middle-standing enterprise; and 10/1,000 in cases of a small or medium enterprise) of the amount invested, shall be deducted from the individual local income tax (limited to individual local income tax on business income). In such cases, Article 103 (1), (3), and (4) shall apply mutatis mutandis to the methods for granting a tax credit. <Amended by Act No. 12506, Mar. 24, 2014; Act No. 14477, Dec. 27, 2016>
(2) A national who seeks application of paragraph (1) shall apply for a tax credit, as prescribed by Presidential Decree.
[This Article Newly Inserted by Act No. 12175, Jan. 1, 2014]
 Article 113 (Tax Credit for Investing in Facilities to Improve Quality Control of Medical Supplies)
(1) Where a national invests (excluding investing in used facilities and through leases prescribed by Presidential Decree) in facilities to improve the quality control of medical supplies prescribed by Presidential Decree by no later than December 31, 2019, the equivalent of 3/1,000 (or 5/1,000 in cases of a middle-standing enterprise; and 7/1,000 in cases of a small or medium enterprise) of the amount invested, shall be deducted from the individual local income tax (limited to individual local income tax on business income). In such cases, Article 103 (1), (3), and (4) shall apply mutatis mutandis to the methods for granting a tax credit. <Amended by Act No. 12506, Mar. 24, 2014; Act No. 14477, Dec. 27, 2016>
(2) A national who seeks application of paragraph (1) shall apply for a tax credit, as prescribed by Presidential Decree.
[This Article Newly Inserted by Act No. 12175, Jan. 1, 2014]
 Article 113-2 (Tax Credit for Investing in Facilities to Commercialize New Growth Technology)
(1) Where a national invests (excluding investing in used facilities and through leases prescribed by Presidential Decree) in facilities to commercialize new growth technology prescribed by Presidential Decree by no later than December 31, 2018, and fulfills each of the following requirements, the equivalent of 7/1,000 (or 8/1,000 in cases of a middle-standing enterprise prescribed by Presidential Decree; and 10/1,000 in cases of a small or medium enterprise) of the amount invested, shall be deducted from the individual local income tax (limited to individual local income tax on business income):
1. The ratio of research and human resources development expenses to the income of the taxable year immediately preceding the taxable year in which the relevant investment is commenced, shall be at least 5/100; and research and development expenses, etc. for a new growth engine and original technology, shall fulfill the requirements prescribed by Presidential Decree;
2. The number of workers at ordinary times in the relevant taxable year shall not have been decreased from the number of workers at ordinary times in the immediately preceding taxable year: Provided, That a tax credit shall be granted even if the number of workers at ordinary times in the relevant taxable year is decreased as compared with that in the immediately preceding year, but ten million won per decreased number of workers at ordinary times shall be deducted from the amount of tax eligible for deduction (if the relevant amount is a negative number, it shall be deemed nil).
(2) Where the number of workers at ordinary times each taxable year during the period from the end of the taxable year in which a tax deduction was granted until the end of the taxable year falling on the second anniversary from the end of the taxable year in which the tax deduction was granted, is decreased as compared with the number of workers at ordinary times in the taxable year in which the tax deduction was granted, a person granted the deduction of individual local income tax pursuant to paragraph (1) or Article 174 (4), shall pay the equivalent of the amount of tax deducted as individual local income tax, as prescribed by Presidential Decree.
(3) A national who seeks application of paragraph (1) shall apply for a tax credit, as prescribed by Presidential Decree.
(4) For the purposes of paragraphs (1) through (3) hereof or Article 174 (4), the methods for determining new growth technology, original technology, etc., the scope and number of workers at ordinary times, and other necessary matters, shall be prescribed by Presidential Decree.
[This Article Newly Inserted by Act No. 14477, Dec. 27, 2016]
 Article 113-3 (Tax Credit for Production Cost of Video Contents)
(1) Where a national prescribed by Presidential Decree incurs any cost prescribed by Presidential Decree, to produce any of the following broadcasting programs or motion pictures prescribed by Presidential Decree (hereafter in this Article, referred to as "video contents") (hereafter in this Article, referred to as "production cost of video contents") by no later than the taxable year in which December 31, 2019 falls, among costs incurred in Korea, the equivalent of 7/1,000 (or 10/1,000 in cases of a small or medium enterprise) of the production cost of the relevant video contents, shall be deducted from the individual local income tax (limited to individual local income tax on business income) for the taxable year in which the relevant video contents are first broadcast or shown in a movie theater, as prescribed by Presidential Decree:
1. A broadcasting program defined in Article 2 of the Broadcasting Act;
(2) A national who seeks application of paragraph (1) shall apply for a tax credit, as prescribed by Presidential Decree.
(3) For the purposes of paragraph (1), the scope of video contents, methods for calculating production cost, and other necessary matters, shall be prescribed by Presidential Decree.
[This Article Newly Inserted by Act No. 14477, Dec. 27, 2016]
 Article 114 (Tax Credit for Employment-Creating Investment)
(1) Where a national makes an investment prescribed by Presidential Decree (excluding investing in used goods and through leases prescribed by Presidential Decree, and investing within the overconcentration control district of the Seoul Metropolitan area; hereafter in this Article, the same shall apply) by no later than December 31, 2017; and the number of workers at ordinary times in the relevant taxable year, has not decreased as compared with the number of workers at ordinary times in the immediately preceding taxable year, the aggregate of the amounts calculated according to the following classification, shall be deducted from the individual local income tax (limited to individual local income tax on business income) each taxable year in which the relevant investment is made: Provided, That in cases of a small or medium enterprise, subparagraph 1 shall apply even where the number of workers at ordinary times in the relevant taxable year has decreased as compared with the number of workers at ordinary times in the immediately preceding taxable year. In such cases, the amount of deduction shall be the amount calculated by deducting one million won per number of workers at ordinary times decreased from the amount referred to in subparagraph 1; and if the relevant amount is a negative number, it shall be deemed nil: <Amended by Act No. 14477, Dec. 27, 2016>
1. Basic amount of deduction: For a small or medium enterprise, the equivalent of 3/1,000 of the relevant amount invested shall be deducted; and for a middle-standing enterprise prescribed by Presidential Decree (hereafter in this Article, referred to as "middle-standing enterprise"), the following relevant amount shall be deducted:
(a) The equivalent of 1/1,000 of the relevant amount invested, where investing in a growth management region or a sanctuary under Article 6 (1) 2 or 3 of the Seoul Metropolitan Area Readjustment Planning Act;
(b) The equivalent of 2/1,000 of the relevant amount invested, where investing in a region outside the Seoul Metropolitan area;
2. Additional amount of deduction: The equivalent of 3/1,000 (or 4/1,000 in cases of a small or medium enterprise or a middle-standing enterprise) of the relevant amount invested, and the equivalent of 4/1,000 (or 5/1,000 in cases of a small or medium enterprise or a middle-standing enterprise) of the relevant amount invested, where investing in a region outside the Seoul Metropolitan area, but where a national operates a service business prescribed by Presidential Decree, the additional amount of deduction shall be the amount calculated by adding thereto the equivalent of 1/1,000 of the relevant amount invested, respectively: Provided, That where such amount exceeds the amount calculated by subtracting the amount prescribed in item (d) from the aggregate of the amounts prescribed in items (a) through (c) in the order, such excess shall be deemed nonexistent:
(a) Number of graduates from schools prescribed by Presidential Decree which provide vocational education and training, such as high schools operating the aligned curricula directly linked to industry demand as schools provided for in Article 2 of the Elementary and Secondary Education Act among the workers at ordinary times who have first entered into an employment contract in the relevant taxable year (hereinafter referred to as "high schools, etc. aligned to industry demand") x 2 million won (or 2.5 million won in cases of a small or medium enterprise);
(b) Number of youth workers, workers with disabilities, and workers aged at least 60 among the workers at ordinary times excluding those in item (a) who have first entered into an employment contract in the relevant taxable year x 1.5 million won (or 2 million won in cases of a small or medium enterprise);
(c) (Number of the workers at ordinary times in the relevant taxable year - number of the workers at ordinary times in the immediately preceding taxable year - number of graduates referred to in item (a) - number of youth workers, workers with disabilities, and workers aged at least 60 referred to in item (b)) x 1 million won (or 1.5 million one in cases of a small or medium enterprise);
(d) 10/100 of the amount of deduction carried forward in the relevant taxable year under Article 174 (3).
(2) Where the number of workers at ordinary times each taxable year during the period from the end of the taxable year in which a tax deduction was granted until the end of the taxable year falling on the second anniversary from the end of the taxable year in which the tax deduction was granted, has decreased as compared with the number of workers at ordinary times in the taxable year in which the tax deduction was granted, a person granted the deduction of the individual local income tax pursuant to paragraph (1), shall pay the equivalent of the amount of tax deducted as individual local income tax, as prescribed by Presidential Decree.
(3) For the purposes of paragraph (1) or (2) hereof or Article 174 (3), the scope of workers at ordinary times, youth workers, workers with disabilities, and workers aged at least 60; the method for calculating the number of workers at ordinary times, graduates from high schools, etc. aligned to industry demand, youth workers, workers with disabilities, and workers aged at least 60; and other necessary matters, shall be prescribed by Presidential Decree.
(4) A national who seeks application of paragraph (1) shall apply for a tax credit, as prescribed by Presidential Decree.
[This Article Newly Inserted by Act No. 12175, Jan. 1, 2014]
SECTION 6 Special Provisions on Employment Support
 Article 115 (Tax Deductions for Small or Medium Enterprises having Reinstated Graduates of High Schools, etc. Aligned to Industry Demand after Performing their Military Service)
(1) Where a small or medium enterprise has employed a person prescribed by Presidential Decree, from among graduates of high schools, etc. aligned to industry demand, if such employee is reinstated by no later than December 31, 2017, after performing the military service prescribed by Presidential Decree (applicable only where he is reinstated within one year after completion of the military service), the equivalent of 1/100 of the labor cost prescribed by Presidential Decree and paid to the reinstated person for two years from the date reinstated, shall be deducted from the individual local income tax (applicable only to individual local income tax on business income) for the relevant taxable year.
(2) A small or medium enterprise that seeks application of paragraph (1) shall apply for a tax credit, as prescribed by Presidential Decree.
[This Article Newly Inserted by Act No. 12175, Jan. 1, 2014]
 Article 115-2 (Tax Credit for Small or Medium Enterprises Re-Employing Career-Interrupted Women)
(1) Where a small or medium enterprise enters into an employment contract with a woman who fulfills each of the following requirements (hereafter in this Article and Article 118 (1) 1, referred to as "career-interrupted woman") for at least one year by not later than December 31, 2017, the equivalent of 1/100 of the personnel expenses prescribed by Presidential Decree, which are paid to the relevant career-interrupted woman until the month falling on the second anniversary from the date of re-employment, shall be deducted from the individual local income tax (applicable only to individual local income tax on business income) for the relevant taxable year:
1. She shall have served at the relevant small or medium enterprise for at least one year (limited to where the fact is verified that the relevant small or medium enterprise has withheld wage and salary income tax of the career-interrupted woman, as prescribed by Presidential Decree);
2. She shall have retired from the relevant small or medium enterprise due to pregnancy, childbirth, or infant care prescribed by Presidential Decree;
3. At least three years, but less than ten years shall have passed from the date she retires from the relevant small or medium enterprise;
4. She shall not be a largest stockholder or largest investor (in cases of an individual business, referring to the representative) of the relevant small or medium enterprise or a person prescribed by Presidential Decree as related to such person.
(2) A small or medium enterprise that seeks application of paragraph (1) shall apply for a tax credit, as prescribed by Presidential Decree.
[This Article Newly Inserted by Act No. 14477, Dec. 27, 2016]
 Article 115-3 (Tax Credit for Enterprises which have Increased Wage and Salary Income)
(1) Where a national fulfills each of the following requirements, the equivalent of 5/1,000 (or 1/100 in cases of a small or medium enterprise or a middle-standing enterprise prescribed by Presidential Decree) of the portion of wages increased beyond the mean of portions increased during the immediately preceding three years, shall be deducted from the individual local income tax (applicable only to individual local income tax on business income) for the relevant taxable year, until the taxable year in which December 31, 2017 falls:
1. The increase rate of average wage of workers at ordinary times prescribed by Presidential Decree (hereafter in this Article, referred to as "workers at ordinary times") in the relevant taxable year, shall be larger than the mean increase rate of average wage in the immediately preceding three taxable years (hereafter in this Article, referred to as "mean increase rate of average wage in the immediately preceding three taxable years");
2. The number of workers at ordinary times in the relevant taxable year, shall be at least the number of workers at ordinary times in the immediately preceding taxable year.
(2) The portion of wages increased beyond the mean of portions increased in the immediately preceding three years, referred to in paragraph (1), shall be an amount calculated by the following formula:
The portion of wages increased beyond the mean of portions increased during the immediately preceding three years = [average wage of workers at ordinary times in the relevant taxable year - average wage of workers at ordinary times in the immediately preceding taxable year x (1 + the mean increase rate of average wage in the immediately preceding three taxable years)] x number of workers at ordinary times in the immediately preceding taxable year.
(3) Where a national fulfills each of the following requirements, the equivalent of 5/1,000 (or 1/100 in cases of a middle-standing enterprise prescribed by Presidential Decree; and 2/100 in cases of a small or medium enterprise) of the aggregate of increased wages of workers who have been converted to regular workers and fulfill requirements prescribed by Presidential Decree, such as work period and type of employment, (hereafter in this Article, referred to as "workers converted to regular workers"), shall be deducted from the individual local income tax (applicable only to individual local income tax on business income) for the relevant taxable year, until the taxable year in which December 31, 2017 falls:
1. There shall have been any worker converted to a regular worker during the relevant taxable year;
2. The number of workers at ordinary times in the relevant taxable year, shall be at least the number of workers at ordinary times in the immediately preceding taxable year.
(4) Where any national granted a deduction of individual local income tax pursuant to paragraph (3), terminates labor relations with a worker converted to a regular worker during the period from the end of the taxable year in which the deduction was granted until the end of the taxable year falling on the first anniversary from the end of the taxable year in which the tax deduction was granted, he/she shall pay an amount calculated as prescribed by Presidential Decree as individual local income tax when he/he files a tax return for the taxable year in which such labor relations terminate.
(5) Notwithstanding paragraph (1), a small or medium enterprise which fulfills each of the following requirements may deduct the equivalent of 10/1,000 of the portion of wage increased beyond the increased portion of the average wage of all small or medium enterprises, in lieu of the amount prescribed in paragraph (1), from individual income tax (applicable only to individual local income tax on business income) until the taxable year in which December 31, 2017 falls:
1. The increase rate of average wage of workers at ordinary times in the relevant taxable year, shall be larger than the rate prescribed by Presidential Decree, based upon the increase rate of wages of all small or medium enterprises;
2. The number of workers at ordinary times in the relevant taxable year, shall be at least the number of workers at ordinary times in the immediately preceding taxable year;
3. The increase rate of the average wage in the immediately preceding taxable year, must not be a negative number.
(6) The portion of wages increased beyond the increased portion of all small or medium enterprises, referred to in paragraph (5), shall be an amount calculated by the following formula:
The portion of wages increased beyond the increased portion of average wage of all small or medium enterprises = [average wage of workers at ordinary times in the relevant taxable year - average wage of workers at ordinary times in the immediately preceding taxable year x (1 + a rate prescribed by Presidential Decree, based upon the increase rate of wages of all small or medium enterprises)] x number of workers at ordinary times in the immediately preceding taxable year.
(7) A national who seeks application of paragraph (1) or (3) shall apply for a tax credit, as prescribed by Presidential Decree.
(8) For the purposes of paragraphs (1) through (4), the scope of wages; methods for calculating the increase rate of average wage and the mean increase rate of average wage in the immediately preceding three taxable years; the aggregate of increased wages of workers converted to regular workers; and other necessary matters, shall be prescribed by Presidential Decree.
[This Article Newly Inserted by Act No. 14477, Dec. 27, 2016]
 Article 115-4 (Tax Credit for Enterprises which have Increased Employment of Youths)
(1) Where the number of youth regular workers prescribed by Presidential Decree (hereafter in this Article, referred to as "number of youth regular workers") of a national (excluding a national who operates a type of business prescribed by Presidential Decree, such as a consumptive service business) in the relevant taxable year during the period until the taxable year in which December 31, 2017 falls, is increased as compared with the number of youth regular workers in the immediately preceding taxable year, an amount calculated by multiplying the increased number of persons (limited to the smaller of the increased number of regular workers prescribed by Presidential Decree (hereafter in this Article, referred to as "whole regular workers") and the increased number of workers at ordinary times prescribed by Presidential Decree (hereafter in this Article, referred to as "workers at ordinary times"), by 200,000 won (or 500,000 won, in cases of a small or medium enterprise or a middle-standing enterprise prescribed by Presidential Decree), shall be deducted from the individual local income tax (applicable only to individual local income tax on business income) for the relevant taxable year.
(2) Where the number of youth regular workers, the number of whole regular workers, or the number of workers at ordinary times each taxable year during the period from the end of the taxable year in which a tax deduction was granted until the end of the taxable year falling on the second anniversary from the end of the taxable year in which the tax deduction was granted, has been decreased as compared with the number of such workers of the taxable year in which the tax deduction was granted, a person granted the deduction of the individual local income tax pursuant to paragraph (1), shall pay the equivalent of the amount of tax deducted as individual local income tax, as prescribed by Presidential Decree.
(3) A national who seeks application of paragraph (1) shall apply for a tax credit, as prescribed by Presidential Decree.
(4) For the purposes of paragraphs (1) and (2), methods for calculating the number of youth regular workers, all regular workers, and workers at ordinary times, and other necessary matters, shall be prescribed by Presidential Decree.
[This Article Newly Inserted by Act No. 14477, Dec. 27, 2016]
 Article 115-5 (Reduction or Exemption of Individual Local Income Tax on Amount Received from Performance Compensation Fund for Core Personnel of Small or Medium Enterprises)
(1) Where any core personnel of small or medium enterprises defined in subparagraph 6 of Article 2 of the Special Act on Support for Human Resources of Small and Medium Enterprises (excluding persons prescribed by Presidential Decree, such as the largest shareholder, etc. of the relevant enterprise; hereafter in this Article, referred to as "core personnel"), join mutual aid programs of the Performance Compensation Fund for Core Personnel of Small and Medium Enterprises under Article 35-2 of the same Act (hereafter in this Article, referred to as the "Performance Compensation Fund") by no later than December 31, 2018; pay mutual aid funds for at least five years; and receive mutual benefit funds from the relevant Performance Compensation Fund, the endowments borne by the relevant small or medium enterprise pursuant to subparagraph 1 of Article 35-3 of the same Act (hereafter in this Article, referred to as "endowments"), shall be subject to the imposition of individual local income tax, construing it as wage and salary income prescribed in Article 20 of the Income Tax Act, but an amount of tax equivalent to 50/100 of individual local income tax shall be reduced.
(2) Of mutual benefit funds, an amount excluding mutual aid funds and endowments paid by core personnel, shall be subject to the imposition of individual local income tax, construing it as interest income prescribed in Article 16 (1) of the Income Tax Act.
(3) Except as otherwise expressly provided for in paragraph (1), methods for calculating reduction or exemption of individual local income tax; procedures for applying reduction or exemption; and other necessary matters, shall be prescribed by Presidential Decree.
[This Article Newly Inserted by Act No. 14477, Dec. 27, 2016]
 Article 116 (Reduction or Exemption of Individual Local Income Tax for Persons Employed in Small or Medium Enterprises)
(1) Where youths prescribed by Presidential Decree (hereafter in this paragraph, referred to as "youths"); persons aged at least 60; or persons with disabilities, are employed by small or medium enterprises prescribed by Presidential Decree (including non-profit corporations) and falling under Article 2 of the Framework Act on Small and Medium Enterprises (hereafter in this Article, referred to as "small or medium enterprises") from January 1, 2012 (from January 1, 2014, in cases of persons aged at least 60 or persons with disabilities), through December 31, 2018, the amount of tax equivalent to 70/100 of individual local income tax, shall be reduced or exempted (up to 150,000 won for each taxable period), regarding the income earned from such small or medium enterprises until the month falling on the third anniversary from the date of employment (referring to the second anniversary from the date reinstated, where a youth is reinstated within one year after providing the military service prescribed by Presidential Decree, to a small or medium enterprise for which he/she has provided labor before providing the military service; and referring to the fifth anniversary from the date of initial employment, where a youth is reinstated within three years from the date of initial employment). In such cases, the period for reduction or exemption of individual local income tax shall be calculated from the first date of employment on which individual local income tax is reduced or exempted, regardless of whether a person granted a reduction or exemption of individual local income tax is employed by another small or medium enterprise or re-employed by the relevant small or medium enterprise. <Amended by Act No. 12955, Dec. 31, 2014; Act No. 14477, Dec. 27, 2016>
(2) Workers who seek application of paragraph (1) shall apply therefor, as prescribed by Presidential Decree.
(3) Where a person liable for special collection becomes aware that a worker who applied for tax reduction or exemption under paragraph (1), has failed to meet the requirements prescribed in paragraph (1), but is unable to specially collect the amount under-collected by applying paragraph (1), due to the retirement of the relevant worker, he/she shall notify the head of the local government having jurisdiction over the place for tax payment of such fact, and the head of the local government having jurisdiction over the place for tax payment shall immediately impose and collect from such worker an amount calculated by multiplying the amount under-collected by applying paragraph (1), by 105/100, as individual local income tax.
(4) Except as otherwise expressly provided for in paragraphs (1) through (3), procedures for applying for the reduction or exemption of individual local income tax; documents to be submitted; and other necessary matters, shall be prescribed by Presidential Decree.
[This Article Newly Inserted by Act No. 12175, Jan. 1, 2014]
 Article 117 (Tax Credit Subsequent to Conversion to Regular Workers)
(1) Where any small or medium enterprise converts fixed-term workers or part-time workers under the Act on the Protection, etc. of Fixed-Term and Part-Time Workers; workers dispatched under the Act on the Protection, etc. of Temporary Agency Workers; or fixed-term workers or part-time workers employed by a subcontractor prescribed in the Fair Transactions in Subcontracting Act, who were employed as at June 30, 2016, to workers whose labor contract is indefinite; where the business owner directly employs them under the Act on the Protection, etc. of Fixed-Term and Part-Time Workers; or where a principal contractor prescribed in Article 2 (2) 2 of the Fair Transactions in Subcontracting Act, directly employs them by entering into indefinite labor contracts (hereafter in this Article, referred to as "conversion to regular workers") by no later than December 31, 2017, an amount calculated by multiplying the number of workers converted to regular workers by 200,000 won, shall be deducted from individual local income tax (limited to individual local income tax on business income) for the relevant taxable year. <Amended by Act No. 14477, Dec. 27, 2016>
(2) Where a person granted a deduction of individual local income tax pursuant to paragraph (1), terminates labor relations with the relevant regular workers before one year passes from the date of conversion to regular workers, he/she shall pay an amount calculated by adding the equivalent to interest calculated as prescribed by Presidential Decree to the equivalent to the amount of tax deducted, when filing a tax return for the taxable year in which such labor relations terminate, as individual local income tax.
(3) For the purposes of paragraph (1), matters necessary for applying for a tax credit, etc. shall be prescribed by Presidential Decree.
[This Article Newly Inserted by Act No. 12175, Jan. 1, 2014]
 Article 118 (Tax Credit of Social Insurance Premiums for Increased Number of Employees in Small or Medium Enterprises)
(1) Where the number of workers at ordinary times in the relevant taxable year of small or medium enterprises surpasses that of the immediately preceding taxable year during the period until the taxable year in which December 31, 2018 falls, the aggregate of the following amounts shall be deducted from individual local income tax (limited to individual local income tax on business income) for the relevant taxable year: <Amended by Act No. 12506, Mar. 24, 2014; Act No. 14477, Dec. 27, 2016>
1. The equivalent to social insurance premiums paid by a user for the increased number of employees who are youth workers and career-interrupted women (hereafter in this Article, referred to as "youth workers, etc.") at ordinary times: Number of increased employees who are youth workers, etc. at ordinary times prescribed by Presidential Decree x amount prescribed by Presidential Decree to be paid by a user as social insurance premiums for the increased number of employees who are youth workers, etc. at ordinary times x 10/100;
2. The equivalent to social insurance premiums paid by a user for the increased number of employees who are workers at ordinary times excluding youth workers, etc.: Number of increased employees who are workers at ordinary times prescribed by Presidential Decree excluding youth workers, etc. x amount prescribed by Presidential Decree to be paid by a user as social insurance premiums for the increased number of employees at ordinary times excluding youth workers, etc. at ordinary times x 5/100 (or 75/1,000 in cases of a small or medium enterprise operating a new-growth service business prescribed by Presidential Decree).
(2) Social insurance under paragraph (1) means any of the following:
1. National insurance under the National Pension Act;
2. Employment insurance under the Employment Insurance Act;
3. Industrial accident compensation insurance under the Industrial Accident Compensation Insurance Act;
4. National health insurance under the National Health Insurance Act;
5. Long-term care insurance under the Long-Term Care Insurance Act.
(3) For the purposes of paragraph (1), matters necessary for applying for a tax credit; the scope of workers at ordinary times and youth workers, etc. at ordinary times; methods for calculating the increased number of employment of youth workers, etc. at ordinary times where a tax credit is applied pursuant to Article 115-2; and other necessary matters, shall be prescribed by Presidential Decree. <Amended by Act No. 14477, Dec. 27, 2016>
[This Article Newly Inserted by Act No. 12175, Jan. 1, 2014]
SECTION 7 Special Provisions on Corporate Restructuring
 Article 119 (Tax Carried Forward, etc. of Individual Local Income Tax on Capital Gains on Consolidation among Small or Medium Enterprises)
(1) Where small or medium enterprises to be extinguished by consolidation among small or medium enterprises engaging in the types of business prescribed by Presidential Decree, transfer fixed assets for business prescribed by Presidential Decree (hereinafter referred to as "fixed assets for business"), to a corporation newly incorporated in the course of consolidation or a corporation surviving such consolidation (hereafter in this Article, referred to as "consolidated corporation"), tax carried forward may be imposed on such fixed assets for business.
(2) The scope of and requirements for consolidation among small or medium enterprises subject to paragraph (1), shall be prescribed by Presidential Decree.
(3) A national who seeks application of paragraph (1) shall apply for tax to be carried forward, as prescribed by Presidential Decree.
(4) Where a national to whom paragraph (1) has been applied, falls under any of the following cases before five years from the date of transfer of fixed assets used for business, he/she shall pay the tax carried forward under paragraph (1) (referring to the amount that excludes tax already paid by a consolidated corporation), as individual local income tax on capital gains, within two months from the last day of the month in which such ground arises. In such cases, matters necessary for the guidelines for judgment of discontinuation of business and others shall be prescribed by Presidential Decree: <Amended by Act No. 12955, Dec. 31, 2014>
1. Where the consolidated corporation discontinues the business succeeded from a small or medium enterprise to be extinguished;
2. Where a national to whom paragraph (1) has been applied, disposes of at least 50/100 of the stocks or equity shares of the consolidated corporation acquired by consolidation.
[This Article Newly Inserted by Act No. 12175, Jan. 1, 2014]
 Article 120 (Tax Carried Forward of Individual Local Income Tax on Capital Gains for Conversion into Corporation)
(1) Where a resident converts his/her business into a corporation (excluding a corporation engaging in a consumptive service business prescribed by Presidential Decree), by investing fixed assets for business as investment in kind; or in accordance with the method of business transfer or acquisition prescribed by Presidential Decree, tax carried forward may apply to such fixed assets for business.
(2) Paragraph (1) shall apply only where the capital of a newly-incorporated corporation exceeds the amount prescribed by Presidential Decree.
(3) Any resident who seeks application of paragraph (1) shall apply for tax to be carried forward, as prescribed by Presidential Decree.
(4) Where a corporation incorporated pursuant to paragraph (1) falls under any of the following cases before five years from the date of its incorporation, a resident to whom paragraph (1) has applied, shall pay the amount of tax carried forward under paragraph (1) (referring to the amount that excludes the amount of tax already paid by the relevant corporation), as individual local income tax on capital gains, within two years from the last day of the month in which such ground arises. In such cases, matters necessary for the guidelines for judgment of discontinuation of business, etc. shall be prescribed by Presidential Decree: <Amended by Act No. 12955, Dec. 31, 2014>
1. Where a corporation incorporated pursuant to paragraph (1), discontinues business succeeded from a resident to whom paragraph (1) has been applied;
2. Where a resident to whom paragraph (1) has been applied, disposes of at least 50/100 of the stocks or equity shares acquired by conversion into a corporation.
[This Article Newly Inserted by Act No. 12175, Jan. 1, 2014]
 Article 121 (Tax Reduction or Exemption for Enterprises Undergoing Trade Adjustment Assistance whose Business is Converted)
(1) Where a business proprietor transfers fixed assets for business used directly for the pre-conversion business (hereafter in this Article, referred to as "fixed assets for the pre-conversion business") by no later than December 31, 2018, and acquires the fixed assets for business, to be used directly for the converted business within one year from the date of transfer to convert business that an enterprise undergoing trade adjustment assistance under Article 6 of the Act on Trade Adjustment Assistance Following the Free Trade Agreements (hereafter in this Article and Article 122, referred to as "enterprise undergoing trade adjustment assistance") has operated (hereafter in this Article, referred to as "pre-conversion business"), into business falling under any subparagraph of Article 6 (3) of the Restriction of Special Taxation Act (hereafter in this Article, referred to as "converted business"), regarding the proceeds from transfer occurred from the transfer of the building and appurtenant land for the pre-conversion business (hereafter in this Article, referred to as "transfer value of pre-conversion business"), an amount of tax equivalent to 50/100 of the individual local income tax on capital gains, may be reduced or exempted, as prescribed by Presidential Decree: Provided, That the main sentence hereof shall not apply where a resident is granted deferred taxation under Article 33 (2) of the Restriction of Special Taxation Act. <Amended by Act No. 14477, Dec. 27, 2016>
(2) Where any national to whom the application of paragraph (1) was applied, fails to convert his/her business or discontinues or closes his/her converted business within three years from the date he/she commences his/her converted business, he/she shall pay the amount of tax reduced or exempted as individual local income tax on capital gains, when calculating his/her income of the business year in which the relevant ground arises. In such cases, the equivalent of the interest calculated as prescribed by Presidential Decree shall be paid in addition to the individual local income tax on capital gains; and the amount of relevant tax shall be deemed the amount of tax payable pursuant to Article 103-7 of the Local Tax Act.
(3) For the purposes of paragraphs (1) and (2), the scope of business conversion and fixed assets for business; submission of application for tax reduction or exemption, and detailed statement of gains on transfer of fixed assets for business; and other necessary matters, shall be prescribed by Presidential Decree.
[This Article Newly Inserted by Act No. 12175, Jan. 1, 2014]
 Article 122 (Tax Reduction or Exemption for Small or Medium Enterprises and Enterprises Undergoing Trade Adjustment Assistance whose Business is Converted)
(1) Where any nationals who operate small or medium enterprises convert business that they have operated continuously for at least five years or business that an enterprise undergoing trade adjustment assistance has operated (hereafter in this Article, referred to as "pre-conversion business"), into business falling under any subparagraph of Article 6 (3) of the Restriction of Special Taxation Act (hereafter in this Article, referred to as "converted business") in an area outside the overconcentration control district of the Seoul Metropolitan area (in cases of an enterprise undergoing trade adjustment assistance, including cases of converting its business within the overconcentration control district of the Seoul Metropolitan area), by no later than December 31, 2018 (in cases of the establishment of a new factory, by no later than December 31, 2020), according to the following subparagraphs, they shall be granted a reduction of an amount of tax equivalent to 50/100 of the individual local income tax on income derived from the converted business in the taxable year in which the first income accrues from such business (where no income accrues from the relevant business by the taxable year falling on the fifth anniversary from the date of business conversion, the taxable year falling on the fifth anniversary) after the date of converting the business prescribed by Presidential Decree (hereafter in this Article, referred to as "date of business conversion") and also within the three subsequent taxable years from the beginning of the subsequent taxable year: <Amended by Act No. 14477, Dec. 27, 2016>
1. Where they transfer or discontinue the pre-conversion business and convert it into the converted business within one year (in cases of the establishment of a new factory, within three years) after the date of such transfer or discontinuance;
2. Where they reduce the size of the pre-conversion business and add the converted business, as prescribed by Presidential Decree.
(2) For the purposes of paragraph (1) 2, the tax reduction or exemption under the same paragraph shall not apply to the taxable year prescribed by Presidential Decree, during the period for reduction.
(3) Where any national to whom paragraph (1) was applied, fails to convert his/her business or discontinues or closes his/her converted business within three years from the date of business conversion, he/she shall pay, as individual local income tax, the amount of tax reduced at the time of calculating the income amount for the taxable year in which such ground arises.
(4) Where the amount of individual local income tax reduced pursuant to paragraph (1) is paid in accordance with paragraph (3), the additional amount equivalent to the interest calculated as prescribed by Presidential Decree shall be paid in addition to the individual local income tax; and the relevant amount of tax shall be deemed the amount of tax payable pursuant to Article 95 of the Local Tax Act.
(5) Any national who seeks application of paragraph (1) shall apply for tax reduction or exemption, as prescribed by Presidential Decree.
[This Article Newly Inserted by Act No. 12175, Jan. 1, 2014]
 Article 123 (Special Taxation of Individual Local Income Tax for Transfer of Assets by Stockholders, etc.)
(1) Where stockholders, etc. who are residents transfer assets owned by themselves and donate the transfer proceeds thereof to the relevant corporation as at December 31, 2018, when stockholders, etc. donate assets to a corporation under Article 40 (1) of the Restriction of Special Taxation Act, they shall be granted exemption of the individual local income tax on capital gains on the equivalent to the amount of donation prescribed by Presidential Decree (hereafter in this Article, referred to as "equivalent to proceeds from transfer") among proceeds from transfer accruing from the transfer of the relevant assets. <Amended by Act No. 14477, Dec. 27, 2016>
(2) Where a corporation in receipt of donated assets under paragraph (1), falls under any subparagraph of Article 40 (4) of the Restriction of Special Taxation Act, the amount of tax exempted under paragraph (1) shall be collected in addition to the amount of corporate local income tax to be paid by the relevant corporation. <Newly Inserted by Act No. 12506, Mar. 24, 2014>
(3) The additional amount equivalent to the interest calculated, as prescribed by Presidential Decree, shall be added to the amount of tax to be paid by a corporation under paragraph (2); and the relevant amount of tax shall be deemed the amount of tax to be paid under Article 103-23 (3) of the Local Tax Act: Provided, That the same shall not apply to cases falling under the proviso to Article 40 (4) 3 of the Restriction of Special Taxation Act. <Newly Inserted by Act No. 12506, Mar. 24, 2014>
(4) For the purposes of paragraphs (1) through (3), matters necessary for applying for tax reduction or exemption, etc. shall be prescribed by Presidential Decree. <Amended by Act No. 12506, Mar. 24, 2014>
[This Article Newly Inserted by Act No. 12175, Jan. 1, 2014]
SECTION 8 Special Provisions on Balanced Regional Development
 Article 124 (Tax Reduction or Exemption for Small or Medium Enterprises Relocated Outside Overconcentration Control District of Seoul Metropolitan Area)
(1) Where a small or medium enterprise (limited to a national) which has continued to operate its business with its factory and facilities in the overconcentration control district of the Seoul Metropolitan area for at least two years, relocates the entire factory and facilities to an area outside the overconcentration control district of the Seoul Metropolitan area as prescribed by Presidential Decree and starts its business there as at December 31, 2017 (if its headquarters or principal office is located in the overconcentration control district of the Seoul Metropolitan area, only applicable where the relevant headquarters or principal office is relocated as well), an amount of tax equivalent to 100/100 of individual local income tax on the income derived from the factory after relocation for the taxable year in which the first income accrues from the relevant factory since the date of relocation (where no income accrues until the taxable year falling on the fifth anniversary from the date of relocation, the taxable year falling on the fifth anniversary from the date of relocation) and for the six subsequent taxable years (or four years, if it is relocated to a growth management region under Article 6 (1) 2 of the Seoul Metropolitan Area Readjustment Planning Act, a sanctuary under Article 6 (1) 3 of the same Act, a Metropolitan City located in an area other than the Seoul Metropolitan area, or an area prescribed by Presidential Decree) from the commencing date of the following taxable year; and an amount of tax equivalent to 50/100 of individual local income tax for the taxable years ending within three years thereafter (or two years thereafter, if it is relocated to a growth management region under Article 6 (1) 2 of the Seoul Metropolitan Area Readjustment Planning Act, a sanctuary under Article 6 (1) 3 of the same Act, a Metropolitan City located in an area other than the Seoul Metropolitan area, or an area prescribed by Presidential Decree), shall be reduced or exempted. <Amended by Act No. 14477, Dec. 27, 2016>
(2) Where a small or medium enterprise entitled to reduction or exemption under paragraph (1), falls under any of the following cases, it shall pay, as individual local income tax, the amount of tax calculated as prescribed by Presidential Decree at the time it files the tax return on the individual local income tax for the taxable year in which the relevant ground arises:
1. Where business is discontinued within three years from the date of commencing the business by relocating the factory: Provided, That this shall not apply where it arises from a merger, split-off, or merger through split-off;
2. Where it does not fall under cases where business is started by relocating its factory to an area outside the overconcentration control district of the Seoul Metropolitan area, as prescribed by Presidential Decree;
3. Where a factory which produces the same products as those produced at the factory relocated pursuant to paragraph (1), or its head office is installed within the overconcentration control district of the Seoul Metropolitan area during the period entitled to reduction or exemption under paragraph (1).
(3) Where the amount of individual local income tax reduced or exempted under paragraph (1) is paid under paragraph (2), the provisions concerning the additional amount equivalent to the interest under Article 122 (4) shall apply mutatis mutandis thereto.
(4) Any person who seeks application of paragraph (1) shall apply for tax reduction or exemption, as prescribed by Presidential Decree.
(5) A small or medium enterprise that seeks application of paragraph (1) shall have conducted the same type of business in the factory before its relocation as that conducted in the factory after its relocation, based on the classification prescribed by Presidential Decree.
(6) Where an enterprise to which reduction or exemption is granted pursuant to paragraph (1), ceases to fall under a small or medium enterprise on the grounds prescribed by Presidential Decree, such as merging with an enterprise which is not a small or medium enterprise under the Framework Act on Small and Medium Enterprises, no reduction or exemption shall be granted from the taxable year in which the relevant grounds arise. <Newly Inserted by Act No. 14477, Dec. 27, 2016>
[This Article Newly Inserted by Act No. 12175, Jan. 1, 2014]
 Article 125 (Tax Reduction or Exemption for Enterprises, etc. Located in Agro-Industrial Complex)
(1) Individual local income tax on any income accruing from the relevant business operated by any of the following persons, shall be reduced or exempted, by applying mutatis mutandis Article 100 (1): <Amended by Act No. 12955, Dec. 31, 2014; Act No. 14111, Mar. 29, 2016; Act No. 14477, Dec. 27, 2016>
1. Any national engaging in a project for developing sources of income for agricultural and fishing villages, after relocating to an agro-industrial complex prescribed by Presidential Decree by no later than December 31, 2018, among those falling under the Industrial Sites and Development Act;
2. A small or medium enterprise engaging in business after relocating to an area for special support for local small or medium enterprises, pursuant to Article 62-23 of the Small and Medium Enterprises Promotion Act, being an area prescribed by Presidential Decree, by no later than December 31, 2018.
(2) Any person who seeks application of paragraph (1) shall apply for tax reduction or exemption, as prescribed by Presidential Decree.
[This Article Newly Inserted by Act No. 12175, Jan. 1, 2014]
 Article 126 (Exemption from Individual Local Income Tax for Members of Agricultural Partnership)
(1) Of the dividends that a member of an agricultural partnership prescribed in the Act on Fostering and Supporting Agricultural and Fisheries Business Entities (hereinafter referred to as "agricultural partnership") receives from the agricultural partnership by no later than December 31, 2018, the entire dividend derived from business of growing crops and other food crops (hereinafter referred to as "food-crop growing business") and an amount of dividend derived from income other than income from food-crop growing business, shall be exempted from individual local income tax within the limits prescribed by Presidential Decree. In such cases, the calculation of the dividend derived from income from food-crop growing business and the dividend derived from income other than food-crop growing business, shall be governed by Presidential Decree. <Amended by Act No. 14477, Dec. 27, 2016>
(2) An amount of tax equivalent to 100/100 of individual local income tax on capital gains on the income derived by agricultural personnel prescribed by Presidential Decree by contributing farmland or grassland the permission for creation of which is obtained pursuant to Article 5 of the Grassland Act (hereinafter referred to as "grassland") to an agricultural partnership as an investment in kind by no later than December 31, 2018, shall be reduced or exempted: Provided, That where the relevant farmland or grassland is incorporated into a residential area, commercial area, or industrial area under the National Land Planning and Utilization Act (hereafter from this Article to Article 131, referred to as "residential area, etc."); or where it is designated as land reserved for substitution for land other than farmland or grassland, prior to a disposition for land substitution pursuant to the Urban Development Act or other statutes, an amount of tax equivalent to 100/100 of individual local income tax on capital gains, shall be exempted only on the amount of income prescribed by Presidential Decree, earned as at the date of incorporation into a residential area, etc. or as at the date of designation of land reserved for land substitution. <Amended by Act No. 12955, Dec. 31, 2014; Act No. 14477, Dec. 27, 2016>
(3) Where any person for whom the individual local income tax on capital gains is reduced under paragraph (2), transfers his/her contribution shares to a third party within three years from the date of the equity investment, the amount calculated as prescribed by Presidential Decree shall be paid as individual local income tax on capital gains as at the time he/she files the tax return for the taxable year in which the date of such transfer falls: Provided, That this shall not apply to cases prescribed by Presidential Decree. <Amended by Act No. 12955, Dec. 31, 2014>
(4) An amount equivalent to interest calculated as prescribed by Presidential Decree shall be added when the individual local income tax on capital gains reduced under paragraph (2) is paid under the main sentence of paragraph (3). <Amended by Act No. 12955, Dec. 31, 2014>
(5) Where agricultural personnel prescribed by Presidential Decree invest in an agricultural partnership with real estate (excluding farmland and grassland referred to in paragraph (2)) used directly for crop-cultivation, stock-breeding, or forestry prescribed in subparagraph 1 of Article 3 of the Framework Act on Agriculture, Rural Community and Food Industry, as at December 31, 2018, they shall be eligible for tax carried forward. <Amended by Act No. 13383, Jun. 22, 2015; Act No. 14477, Dec. 27, 2016>
(6) Any person who seeks application of paragraph (1), (2), or (5) shall apply therefor, as prescribed by Presidential Decree.
(7) Where agricultural personnel to whom paragraph (5) was applied, dispose of at least 50/100 of the stocks or equity shares acquired through investment in kind within three years from the date of investment, the amount of tax carried forward under paragraph (7) (referring to the amount excluding the amount of tax already paid by the relevant agricultural partnership), shall be paid as individual local income tax on capital gains as prescribed by Presidential Decree within two months from the end of the month of disposal. <Amended by Act No. 12955, Dec. 31, 2014>
(8) Matters necessary for the standards for determining, etc. disposal of at least 50/100 of stocks or equity shares where an amount of tax carried forward under paragraph (5), is paid pursuant to paragraph (7), shall be prescribed by Presidential Decree; and an amount equivalent to interest calculated as prescribed by Presidential Decree shall be added thereto.
[This Article Newly Inserted by Act No. 12175, Jan. 1, 2014]
 Article 127 (Exemption, etc. from Individual Local Income Tax for Members of Fisheries Partnership)
(1) Of the dividends that a member of a fisheries partnership prescribed in the Act on Fostering and Supporting Agricultural and Fisheries Business Entities (hereinafter referred to as "fisheries partnership") receives from the fisheries partnership by no later than December 31, 2018, an amount within the limits prescribed by Presidential Decree, shall be exempted from individual local income tax. <Amended by Act No. 14477, Dec. 27, 2016>
(2) An amount of tax equivalent to 100/100 of individual local income tax on capital gains on the income derived from investment in kind with land, etc. for fisheries prescribed by Presidential Decree (hereafter in this Article, referred to as "land, etc. for fisheries") in a fisheries partnership and in a fisheries company prescribed in the Act on Fostering and Supporting Agricultural and Fisheries Business Entities made by fisheries personnel prescribed by Presidential Decree as at December 31, 2018, shall be reduced or exempted: Provided, That where the relevant land, etc. for fisheries is incorporated into a residential area, etc.; or where it is designated as land reserved for substitution for land other than land, etc. for fisheries, prior to a disposition for land substitution pursuant to the Urban Development Act or other statutes, an amount of tax equivalent to 100/100 of individual local income tax on capital gains shall be exempted only on the amount of income prescribed by Presidential Decree, earned as at the date of incorporation into a residential area, etc. or as at the date of designation of land reserved for land substitution. <Amended by Act No. 12955, Dec. 31, 2014; Act No. 14477, Dec. 27, 2016>
(3) Where a person for whom individual local income tax on capital gains is reduced under paragraph (2), transfers his/her equity shares to a third party within three years from the date of the equity investment, an amount of tax calculated as prescribed by Presidential Decree shall be paid as individual local income on capital gains as at the time he/she files a tax return on the individual local income tax for the taxable year in which the date of such transfer falls: Provided, That this shall not apply where prescribed by Presidential Decree. <Amended by Act No. 12955, Dec. 31, 2014>
(4) Article 126 (4) and (6) shall apply mutatis mutandis to the application for tax reduction and exemption under paragraphs (1) and (2) and the payment of the amount of tax under the main sentence of paragraph (3). <Amended by Act No. 12955, Dec. 31, 2014>
[This Article Newly Inserted by Act No. 12175, Jan. 1, 2014]
 Article 128 (Exemption, etc. from Individual Local Income Tax on Capital Gains for Agricultural Personnel, etc.)
(1) An amount of tax equivalent to 100/100 of individual local income tax on capital gains income derived from investment in kind with farmland or grassland in an agricultural company prescribed in the Act on Fostering and Supporting Agricultural and Fisheries Business Entities (hereinafter referred to as "agricultural company"; and in this paragraph, an agricultural company shall be limited only to a company that meets the requirements for an agricultural corporation under the Farmland Act) made by agricultural personnel prescribed by Presidential Decree as at December 31, 2018, shall be reduced or exempted: Provided, That where the relevant farmland or grassland is incorporated into a residential area, etc.; or where it is designated as land reserved for substitution for land other than farmland or grassland, etc., prior to a disposition for land substitution pursuant to the Urban Development Act or other statutes, an amount of tax equivalent to 100/100 of individual local income tax on capital gains, shall be exempted only on the amount of income prescribed by Presidential Decree, earned as at the date of incorporation into a residential area, etc. or as at the date of designation of land reserved for land substitution. <Amended by Act No. 12955, Dec. 31, 2014; Act No. 14477, Dec. 27, 2016>
(2) Where agricultural personnel prescribed by Presidential Decree invest in an agricultural company with real estate (excluding farmland and grassland referred to in paragraph (1)) used directly for crop-cultivation, stock-breeding, or forestry, prescribed in subparagraph 1 of Article 3 of the Framework Act on Agriculture, Rural Community and Food Industry as at December 31, 2018, they shall be eligible for the application of tax carried forward. In such cases, Article 126 (7) and (8) shall apply mutatis mutandis. <Amended by Act No. 13383, Jun. 22, 2015; Act No. 14477, Dec. 27, 2016>
(3) Of the dividends that a resident who has invested in an agricultural company receives from the agricultural company by no later than December 31, 2018, the whole amount of dividends derived from income from food-crop growing business shall be exempted from individual local income tax. <Amended by Act No. 14477, Dec. 27, 2016>
(4) Any person who seeks application of paragraphs (1) through (3) shall apply therefor, as prescribed by Presidential Decree.
(5) Article 126 (3), (4), and (6) shall apply mutatis mutandis to reduction or exemption of individual local income tax on capital gains income referred to in paragraph (1). <Newly Inserted by Act No. 14477, Dec. 27, 2016>
[This Article Newly Inserted by Act No. 12175, Jan. 1, 2014]
 Article 129 (Reduction or Exemption of Individual Local Income Tax on Capital Gains for Self-Cultivating Farmland)
(1) Individual local income tax on capital gains shall be exempted if the capital gains are derived from transferring land prescribed by Presidential Decree among that cultivated directly by a method prescribed by Presidential Decree by a resident prescribed by Presidential Decree who resides at a place where farmland is located for at least eight years [for at least three years where farmland entitled to the directly paid subsidy for the transfer of management prescribed by Presidential Decree is transferred, as at December 31, 2018, to the Korea Rural Community Corporation under the Korea Rural Community Corporation and Farmland Management Fund Act or a corporation prescribed by Presidential Decree whose main business line is agriculture (hereafter in this Article, referred to as "agricultural corporation")]: Provided, That where the relevant land is incorporated into a residential area, etc.; or where it is designated as land reserved for land substitution, other than farmland, prior to a disposition for land substitution under the Urban Development Act or other statutes, the individual local income tax on capital gains shall be exempted only on the amount of income prescribed by Presidential Decree, earned as at the date of incorporation into a residential area, etc. or as at the date of designation of land reserved for land substitution. <Amended by Act No. 14477, Dec. 27, 2016>
(2) Where an agricultural corporation transfers the land in question within three years from the date of acquisition of such land, or where any ground prescribed by Presidential Decree arises, the relevant corporation shall pay the equivalent to the amount of tax exempted pursuant to paragraph (1) as corporate local income tax, at the time of filing its tax return for the taxable year in which such ground arises.
(3) Any person who seeks application of paragraph (1) shall apply for tax reduction or exemption, as prescribed by Presidential Decree.
[This Article Newly Inserted by Act No. 12175, Jan. 1, 2014]
 Article 130 (Reduction or Exemption of Individual Local Income Tax on Capital Gains for Site for Livestock Stables)
(1) Individual local income tax on capital gains shall be exempted if the relevant income is derived by a resident prescribed by Presidential Decree, who resides where a stable used for breeding livestock and appurtenant land (hereafter in this Article, referred to as "site for livestock stables") are located, from the transfer of the site for livestock stables (within 1,650 square meters per person) prescribed by Presidential Decree, used directly for breeding livestock by a method prescribed by Presidential Decree for at least eight years as at December 31, 2017, for business closure: Provided, That where the relevant land is incorporated into a residential area, etc.; or where it is designated as land reserved for land substitution for a site other than for livestock stables, prior to a disposition for land substitution pursuant to the Urban Development Act or other statutes, the individual local income tax on capital gains shall be exempted only on the amount of income prescribed by Presidential Decree, earned as at the date of incorporation into a residential area, etc. or as at the date of designation of land reserved for land substitution. <Amended by Act No. 12955, Dec. 31, 2014; Act No. 14477, Dec. 27, 2016>
(2) Where a resident whose individual local income tax on capital gains has been exempted pursuant to paragraph (1), re-commences livestock business within five years after transferring the relevant site for livestock stables, the amount of tax exempted shall be additionally collected: Provided, That this shall not apply where prescribed by Presidential Decree, such as inheritance.
(3) Any person who seeks application of paragraph (1) shall apply for tax reduction or exemption, as prescribed by Presidential Decree.
(4) For the purposes of paragraphs (1) through (3), the period for holding a site for livestock stables; the scope of business closure; the method for calculating the amount of tax reduced or exempted; and other necessary matters, shall be prescribed by Presidential Decree.
[This Article Newly Inserted by Act No. 12175, Jan. 1, 2014]
 Article 131 (Reduction or Exemption of Individual Local Income Tax on Capital Gains for Substitute Land for Farmland)
(1) Individual local income tax on capital gains shall be exempted if the relevant income is derived by a resident prescribed by Presidential Decree, who resides in the location of farmland, from the exchange of land cultivated directly by a method prescribed by Presidential Decree, under the necessity of cultivation, for farmland falling under cases prescribed by Presidential Decree: Provided, That where the land in question is incorporated into a residential area, etc.; or where it is designated as land reserved for land substitution for a site other than farmland, prior to a disposition for land substitution pursuant to the Urban Development Act or other statutes, the individual local income tax on capital gains shall be exempted only on the amount of income prescribed by Presidential Decree, earned as at the date of incorporation into a residential area, etc., or as at the date of designation of land reserved for land substitution. <Amended by Act No. 14477, Dec. 27, 2016>
(2) Paragraph (1) shall not apply where any land transferred or acquired pursuant to paragraph (1) is incorporated into a residential area, etc.; or where it is designated as land reserved for land substitution, other than as farmland, prior to a disposition for land substitution taken pursuant to the Urban Development Act or other statutes, which is land prescribed by Presidential Decree. <Amended by Act No. 14477, Dec. 27, 2016>
(3) Any person who seeks reduction or exemption as prescribed in paragraph (1) shall apply therefor, as prescribed by Presidential Decree.
(4) Where a resident granted a reduction or exemption of individual local income tax on capital gains under paragraph (1), fails to fulfill the requirements prescribed in paragraph (1) due to grounds prescribed by Presidential Decree, he/she shall pay the reduced or exempted individual local income tax on capital gains within two months from the end of the month in which such ground arises.
(5) Where the individual local income tax on capital gains reduced or exempted under paragraph (1) is paid under paragraph (4), an amount equivalent to the interest calculated as prescribed by Presidential Decree shall be added thereto.
[This Article Newly Inserted by Act No. 12175, Jan. 1, 2014]
 Article 131-2 (Special Taxation of Individual Local Income Tax on Capital Gains on Sale, etc. of Farmland for Revival of Management)
(1) Where a farmer defined in Article 2 of the Farmland Act (hereafter in this Article, referred to as "agricultural personnel") has transferred farmland that he/she cultivated under Article 24-3 (1) of the Korea Rural Community Corporation and Farmland Management Fund Act and agricultural facilities attached to such farmland (hereafter in this Article, referred to as "farmland, etc.") to the Korea Rural Community Corporation under Article 3 of the same Act (hereafter in this Article, referred to as the "Korea Rural Community Corporation"), cultivates it directly on a lease, and repurchases the relevant farmland, etc. within the rental period under Article 24-3 (3) of the same Act, he/she shall be eligible to a refund of the individual local income tax on capital gains that he/she has paid for the income derived from the transfer of the relevant farmland, etc., as prescribed by Presidential Decree.
(2) Where a farmer who has received the refund of individual local income tax on capital gains under paragraph (1) retransfers the relevant farmland, etc. that he/she repurchased, Article 70-2 (2) of the Restriction of Special Taxation Act shall apply mutatis mutandis to the acquisition value and the timing for acquisition thereof.
(3) A person who intends to receive a refund under paragraph (1) shall apply for a refund, as prescribed by Presidential Decree.
(4) For the purposes of paragraphs (1) and (2), where the repurchased farmland, etc. is retransferred, the method for applying reduction or exemption of individual local income tax on capital gains on self-cultivating farmland under Article 129, and other necessary matters, shall be prescribed by Presidential Decree.
[This Article Newly Inserted by Act No. 12506, Mar. 24, 2014]
SECTION 9 Special Provisions on Support for Public Works Projects
 Article 132 (Reduction or Exemption of Individual Local Income Tax on Capital Gains on Land, etc. for Public Works Projects)
(1) An amount of tax equivalent to 10/100 (or 15/100 where a portion of the transfer price of land, etc. is paid in bonds prescribed by Presidential Decree, but 30/100 (or 40/100 where the bond maturity is at least five years) in cases of income derived from purchase by mutual agreement or expropriation under Acts prescribed by Presidential Decree, such as the Special Act on Public Housing; and in cases of which a special agreement is made to retain the bonds until a maturity of at least three years, as prescribed by Presidential Decree) of the individual local income tax on capital gains, shall be reduced for any of the following income derived by December 31, 2018, from the transfer of land, etc. acquired within two years retroactively from the date the project approval is publicly announced (or the date of transfer, where transfer is implemented before the date the project approval is publicly announced) granted for the area for public project wherein the relevant land, etc. is located: <Amended by Act No. 12506, Mar. 24, 2014; Act No. 13498, Aug. 28, 2015; Act No. 14477, Dec. 27, 2016>
1. Income derived from the transfer to an implementer of a public works project on such land, etc. as necessary for the public works project to which the Act on Acquisition of and Compensation for Land, etc. for Public Works Projects applies;
2. Income derived from the transfer to an implementer of a project under the Act on the Maintenance and Improvement of Urban Areas and Residential Environments on such land, etc. as located in an area to be maintained and improved under the same Act (excluding such area to be maintained and improved as unaccompanied by infrastructure to be maintained and improved);
3. Income derived from the expropriation of land, etc. under the Act on Acquisition of and Compensation for Land, etc. for Public Works Projects or other statutes.
(2) Where a resident transfers land, etc. he/she owns for at least two years (referring to land, etc. necessary for public works projects under paragraph (1) 1 or land, etc. within an area to be maintained and improved under subparagraph 2 of the same paragraph; hereafter in this paragraph, the same shall apply) to the implementer of a public works project under paragraph (1) 1 and a project implementer (hereafter in this Article, referred to as "project implementer") before being designated as a project implementer under subparagraph 2 of the same paragraph (hereafter in this paragraph, referred to as "project implementer before designation") as at December 2015, and files a tax return (including an interim return) on individual local income for the taxable period not later than the statutory period of the return, if the project implementer before designation is designated as the project implementer within five years from the date the land, etc. is transferred, the individual local income tax on capital gains under paragraph (1) may be reduced or exempted, as prescribed by Presidential Decree. In such cases, the calculation of the individual local income tax on capital gains to be reduced or exempted shall be governed by the applicable Act as at the time of transfer, although the reduction or exemption rate, etc. is changed.
(3) In any of the following cases, the relevant project implementer shall pay the equivalent of the amount of tax reduced or exempted under paragraph (1) or (2) as local income tax, at the time of his/her tax return for the taxable year in which such case occurs: <Amended by Act No. 12955, Dec. 31, 2014; Act No. 14567, Feb. 8, 2017>
1. Where an implementer of a public works project prescribed in paragraph (1) 1 fails to undertake the public works project within three years from the date he/she obtained authorization, etc. to implement the same;
2. Where a project implementer under paragraph (1) 2 fails to obtain authorization for the implementation plan of the project, or to complete the project, under the Act on the Maintenance and Improvement of Urban Areas and Residential Environments by the deadline prescribed by Presidential Decree.
(4) Where a person who had contracted a special agreement to retain relevant bonds until maturity as prescribed in paragraph (1) and had an amount of tax equivalent to 30/100 (or 40/100 in cases of bonds with a maturity of at least five years) of individual local income tax on capital gains reduced or exempted, has breached such special agreement, the equivalent of 10/100 (or 20/100 in cases of bonds with a maturity of at least five years) of individual local income tax on capital gains out of the amount of tax reduced or exempted, shall be collected immediately. <Amended by Act No. 12506, Mar. 24, 2014>
(5) Article 122 (4) concerning an additional amount equivalent to the interest shall apply mutatis mutandis where the amount of tax reduced or exempted under paragraph (1) 1 or 2 or (2) is paid under paragraph (3); and Article 126 (4) shall apply mutatis mutandis where the amount of tax reduced or exempted under paragraph (1) is collected under paragraph (4).
(6) Where a project implementer intends to be granted a tax reduction or exemption as prescribed in paragraph (1) 1 or 2, he/she shall apply for reduction or exemption, as prescribed by Presidential Decree.
(7) Any person who seeks reduction or exemption under paragraph (1) 3 shall apply therefor, as prescribed by Presidential Decree.
(8) For the purposes of paragraphs (1) and (4), the terms and conditions of the special agreement to retain related bonds until maturity, and other necessary matters, shall be prescribed by Presidential Decree.
(9) For the purposes of paragraphs (1) and (2), regarding land, etc. inherited or donated to which Article 97-2 (1) of the Income Tax Act applies, the date an ancestor or donator acquired the relevant land, etc. shall be deemed the date of acquisition of the relevant land, etc.
[This Article Newly Inserted by Act No. 12175, Jan. 1, 2014]
 Article 133 (Reduction or Exemption of Individual Local Income Tax on Capital Gains for Land, etc. subject to Purchase following Designation of Development Restriction Zones)
(1) Any income derived from transfer of the relevant land, etc. in a development restriction zone designated under Article 3 of the Act on Special Measures for Designation and Management of Development Restriction Zones (hereafter in this Article, referred to as "development restriction zone") through claim for purchase of land prescribed in Article 17 of the same Act or purchase by consultation under Article 20 of the same Act, by no later than December 31, 2017, shall be entitled to the reduction of or exemption from the following amount of tax: <Amended by Act No. 12506, Mar. 24, 2014; Act No. 12955, Dec. 31, 2014>
1. Land, etc. owned by a resident prescribed by Presidential Decree residing in the location of the relevant land, etc. from the date of acquisition to the date purchase is claimed or the date of purchase by consultation after he/she acquired the relevant land, etc. prior to the date it is designated as a development restriction zone: An amount of tax equivalent to 40/100 of the individual local income tax on capital gains;
2. Land, etc. owned by a resident prescribed by Presidential Decree residing in the location of the relevant land, etc. from the date of acquisition to the date purchase is claimed or the date of purchase by consultation after he/she acquired the relevant land, etc. 20 years prior to the date purchase is claimed or the date of purchase by consultation: An amount of tax equivalent to 25/100 of the individual local income tax on capital gains.
(2) Any income derived from transfer of the relevant land, etc. on which the designation of a development restriction zone is cancelled, through purchase by consultation or expropriation under the Act on Acquisition of and Compensation for Land, etc. for Public Works Projects or other statutes, by no later than December 31, 2017, shall be entitled to the reduction of or exemption from the following amount of tax: Provided, That this shall be limited to where approval for a project is publicly announced in accordance with the Act on Acquisition of and Compensation for Land, etc. for Public Works Projects or other statutes within one year (or five years when the relevant area is designated as an area prescribed by Presidential Decree, such as designation of a free economic zone prescribed in the Act on Designation and Management of Free Economic Zones, prior to the cancellation of designation of development restriction zones) from the date the designation of a development restriction zone is cancelled: <Amended by Act No. 12506, Mar. 24, 2014; Act No. 12955, Dec. 31, 2014>
1. Land, etc. owned by a resident prescribed by Presidential Decree residing in the location of the relevant land, etc. from the date of acquisition to the date the project approval is publicly announced after he/she has acquired the relevant land, etc. prior to the date it is designated as a development restriction zone: An amount of tax equivalent to 40/100 of the individual local income tax on capital gains;
2. Land, etc. owned by a resident prescribed by Presidential Decree residing in the location of the relevant land, etc. from the date of acquisition to the date the project approval is publicly announced after he/she has acquired the relevant land, etc. 20 years before the date the project approval is publicly announced: An amount of tax equivalent to 25/100 of the individual local income tax on capital gains.
(3) For the purposes of paragraph (1) or (2), regarding land, etc. inherited, the date an ancestor acquired the relevant land, etc., shall be deemed the date of acquisition of the relevant land, etc.
(4) For the purposes of paragraph (1) or (2), application for reduction or exemption; calculation of the period of residence; and other necessary matters, shall be prescribed by Presidential Decree.
[This Article Newly Inserted by Act No. 12175, Jan. 1, 2014]
 Article 134 (Tax Reduction or Exemption for Relocating Factories in Areas Subject to Planned Development of Administrative City and Innovation Cities, to Rural Areas)
(1) Where any national conducting business with his/her factory facilities installed within an area subject to the planned development of the Administrative City under the Special Act on the Construction of Administrative City in Yeongi-Gongju Area for Follow-up Measure of New Administrative Capital or an area subject to the planned development of an innovation city under the Special Act on the Construction and Development of Innovation Cities (hereafter in this Article, referred to as "Administrative City, etc."), relocates to an area outside the Administrative City, etc. prescribed by Presidential Decree (hereafter in this Article, referred to as "rural area") and commences business there, regarding the income accruing from the previous business, he/she shall be granted a reduction of an amount of tax equivalent to 50/100 of the individual local income tax on the income generated from the previous business in the taxable year in which the first income accrues after the date of relocation (where no income accrues from the relevant business by the taxable year falling on the fifth anniversary from the date of relocation, the taxable year falling on the fifth anniversary) and also within the three subsequent taxable years from the beginning of the subsequent taxable year.<Amended by Act No. 15309, Dec. 26, 2017>
(2) Any national who seeks application of paragraph (1) shall apply for tax reduction or exemption, as prescribed by Presidential Decree, together with a tax return of the relevant taxable year.
[This Article Newly Inserted by Act No. 12175, Jan. 1, 2014]
 Article 135 (Reduction or Exemption of Individual Local Income Tax, etc. for Social Enterprises and Standard Workplaces for Persons with Disabilities)
(1) Any national accredited as a social enterprise by no later than December 31, 2019, as prescribed in subparagraph 1 of Article 2 of the Social Enterprise Promotion Act, shall be granted a tax reduction or exemption equivalent to 100/100 of individual local income tax on the income accrued from the relevant business in the taxable year in which the first income accrues after such accreditation (where no income accrues from the relevant business by the taxable year falling on the fifth anniversary from the date of accreditation, the taxable year falling on the fifth anniversary) and also within the two subsequent taxable years from the beginning of the subsequent taxable year; and further shall be granted a tax reduction equivalent to 50/100 of the individual local income tax for the two subsequent taxable years thereafter. <Amended by Act No. 14477, Dec. 27, 2016>
(2) Any national accredited as a standard workplace for persons with disabilities under subparagraph 8 of Article 2 of the Act on the Employment Promotion and Vocational Rehabilitation of Persons with Disabilities by no later than December 31, 2019, shall be granted a tax reduction or exemption equivalent to 100/100 of the individual local income tax on the income accrued from the relevant business in the taxable year in which the first income accrues from such business (where no income accrues from the relevant business by the taxable year falling on the fifth anniversary from the date of accreditation, the taxable year falling on the fifth anniversary) and also within the two subsequent taxable years from the beginning of the immediately following taxable year; and further shall be granted a tax reduction equivalent to 50/100 of the individual local income tax for the two subsequent taxable years thereafter. <Amended by Act No. 14477, Dec. 27, 2016>
(3) For the purposes of paragraph (1), where the accreditation of a social enterprise is revoked pursuant to Article 18 of the Social Enterprise Promotion Act because it falls under any of the following cases during the period of tax reduction or exemption, the relevant national shall not be eligible for the reduction or exemption of the individual local income tax under paragraph (1) from the relevant taxable year:
1. Where it obtains accreditation fraudulently or deceptively;
2. Where it ceases to meet the requirements for accreditation under Article 8 of the Social Enterprise Promotion Act.
(4) For the purposes of paragraph (2), where the relevant standard workplace for persons with disabilities falls under any of the following cases during the period of tax reduction or exemption, the relevant national shall not be eligible for the reduction or exemption of the individual local income tax under paragraph (2) from the relevant taxable year:
2. Where the business operator fails to use a loan or subsidy granted under Article 21 or 22 of the Act on the Employment Promotion and Vocational Rehabilitation of Persons with Disabilities for purposes provided for in the same provisions;
3. Where it ceases to comply with the standards under subparagraph 8 of Article 2 of the Act on the Employment Promotion and Vocational Rehabilitation of Persons with Disabilities.
(5) Where any national granted a tax reduction or exemption pursuant to paragraph (1) or (2) falls under paragraph (3) 1 or (4) 1, he/she shall pay the amount of tax reduced or exempted, with an additional amount calculated by applying the additional amount equivalent to interest prescribed by Presidential Decree, as individual local income tax, at the time of filing a tax return for the taxable year in which such ground arises.
(6) Any person who seeks application of paragraph (1) or (2) shall apply for reduction or exemption, as prescribed by Presidential Decree.
[This Article Newly Inserted by Act No. 12175, Jan. 1, 2014]
 Article 136 (Reduction or Exemption of Individual Local Income Tax on Capital Gains for Mountainous Areas Transferred to State)
(1) Where a national transfers a mountainous area prescribed in the Mountainous Districts Management Act (excluding a mountainous area located in an urban area prescribed in the National Land Planning and Utilization Act; hereafter in this paragraph, referred to as "mountainous area") which he/she owns for at least two years to the State by December 31, 2017, pursuant to Article 18 of the State Forest Administration and Management Act, an amount of tax equivalent to 10/100 of individual local income tax on capital gains on the income accrued from such transfer, shall be reduced. <Amended by Act No. 12506, Mar. 24, 2014; Act No. 12955, Dec. 31, 2014; Act No. 14477, Dec. 27, 2016>
(2) Any person who seeks application of paragraph (1) shall apply for reduction or exemption, as prescribed by Presidential Decree.
[This Article Newly Inserted by Act No. 12175, Jan. 1, 2014]
SECTION 10 Special Provisions on Stabilization of National Living
 Article 137 (Tax Credit for Investment in Facilities for Promotion of Workers' Welfare)
(1) If a national prescribed by Presidential Decree acquires (including new construction, expansion, repair, or purchase; hereafter in this Article, the same shall apply) any of the following facilities by no later than December 31, 2018, to promote the welfare of his/her employees, such as residential stability, the equivalent of 7/1,000 (or 10/1,000 where a national who acquires such facilities is a small or medium enterprise, or where facilities referred to in subparagraph 1 or 2 which are housing units prescribed by Presidential Decree outside of the Seoul Metropolitan area, or facilities referred to in subparagraph 3 are acquired) of the acquisition price of the relevant facilities (excluding the purchase price of land appurtenant to such facilities), shall be deducted from his/her individual local income tax (limited to individual local income tax on business income) for the taxable year in which the date of acquisition falls: <Amended by Act No. 12955, Dec. 31, 2014; Act No. 14477, Dec. 27, 2016>
1. National housing to be rented to employees who do not own a house (excluding executives who are equity investors);
2. Dormitory for employees;
3. Child care centers in a workplace prescribed in the Child Care Act;
4. Facilities prescribed by Presidential Decree as those for improving convenience of person with a disability, elderly persons, pregnant women, etc.;
5. Facilities prescribed by Presidential Decree as those for the rest or health training, etc. of employees;
6. Auxiliary medical institutions established under Article 35 of the Medical Service Act for providing health care to his/her employees.
(2) Matters necessary for calculating a tax credit, where national housing under paragraph (1) 1 is acquired together with other houses, or where a dormitory under paragraph (1) 2 is acquired together with other buildings, shall be prescribed by Presidential Decree.
(3) Any national who seeks application of paragraph (1) shall apply for a tax credit, as prescribed by Presidential Decree.
(4) Where a person granted a deduction of individual local income tax under paragraph (1) or (2), diverts the relevant assets to other purposes within five years from the date work is completed or date the relevant assets are purchased, he/she shall pay, as individual local income tax, such amounts obtained by adding the additional amount equivalent to the interest calculated as prescribed by Presidential Decree, to the equivalent to the amount of tax deduction on the relevant assets, at the time of filing a tax return on the individual local income tax for the taxable year in which the date of such diversion falls; and the relevant amount of tax shall be deemed the amount of tax payable under Article 95 of the Local Tax Act. <Amended by Act No. 12955, Dec. 31, 2014>
[This Article Newly Inserted by Act No. 12175, Jan. 1, 2014]
 Article 137-2 (Tax Credit for Monthly Rents)
Where the amount of monthly rents paid is deducted from the assessed global income pursuant to Article 95-2 (1) of the Restriction of Special Local Taxation Act, the equivalent of 12/100 of the amount deducted shall be deducted from the individual local income tax assessed on global income for the relevant taxable year. <Amended by Act No. 14477, Dec. 27, 2016>
[This Article Newly Inserted by Act No. 12955, Dec. 31, 2014]
 Article 138 (Tax Reduction or Exemption for Small-Housing Rental Business Operators)
(1) Where a resident prescribed by Presidential Decree, leases at least three rental houses prescribed by Presidential Decree (hereafter in this Article, referred to as "rental houses"), an amount of tax equivalent to 30/100 [or 75/100 in cases of commercial rental housing defined in subparagraph 4 of Article 2 of the Special Act on Private Rental Housing or quasi-public rental housing defined in subparagraph 5 of Article 2 of the same Act (hereafter in this Article, referred to as "quasi-public rental housing, etc.")] of the individual local income tax on income accrued from the relevant rental business until the taxable year ending as at December 31, 2019, shall be reduced. <Amended by Act No. 14477, Dec. 27, 2016>
(2) Where any national granted a reduction of individual local income tax under paragraph (1), fails to lease at least three rental houses as prescribed by Presidential Decree for at least four years (or eight years in cases of quasi-public rental housing, etc.), he/she shall pay the amount of tax reduced as individual local income tax, at the time he/she files a tax return for the taxable year in which such ground arises. <Amended by Act No. 14477, Dec. 27, 2016>
(3) Where the individual local income tax reduced pursuant to paragraph (1), is paid in accordance with paragraph (2), Article 122 (4) on the additional amount equivalent to the interest shall apply mutatis mutandis: Provided, That the same shall not apply in extenuating circumstances prescribed by Presidential Decree.
(4) Any person who seeks reduction or exemption of individual local income tax as prescribed in paragraph (1), shall apply therefor, as prescribed by Presidential Decree.
(5) For the purposes of paragraphs (1) through (4), the number of rental houses; application for tax reduction or exemption; and other necessary matters, shall be prescribed by Presidential Decree.
[This Article Newly Inserted by Act No. 12175, Jan. 1, 2014]
 Article 139 (Reduction or Exemption of Individual Local Income Tax on Capital Gains for Long-Term Rental Houses)
(1) If a resident prescribed by Presidential Decree, transfers any of the following national housing (including land appurtenant thereto not exceeding twice the gross floor area of the relevant building) after the lease for at least five years since its commencement as at December 31, 2000, 50/100 of the individual local income tax on capital gains on income accrued from the transfer of such housing unit (hereinafter referred to as "rental house"), shall be reduced: Provided, That in cases of a rental house rented for at least five years among the constructed rental housing under the Special Act on Private Rental Housing or the Special Act on Public Housing; and of a rental house (only applicable to a house not occupied at the time it is acquired) rented for at least five years from acquisition and commencement of rent after January 1, 1995, among the purchased rental housing under the same Act; and of a rental house rented for at least ten years, individual local income tax on capital gains shall be exempted: <Amended by Act No. 13499, Aug. 28, 2015>
1. Houses newly built during the period between January 1, 1986 and December 31, 2000;
2. Multi-family houses newly built as at December 31, 1985, not occupied as at January 1, 1986.
(2) For the purposes of Article 89 (1) 3 of the Income Tax Act, no rental house shall be deemed a house owned by the relevant resident.
(3) Any person who seeks reduction or exemption of individual local income tax on capital gains as prescribed in paragraph (1), shall report on the matters concerning the rental house and apply for tax reduction or exemption, as prescribed by Presidential Decree.
(4) The method for calculating the rental period for a rental house under paragraph (1), and other necessary matters, shall be prescribed by Presidential Decree.
[This Article Newly Inserted by Act No. 12175, Jan. 1, 2014]
 Article 140 (Exemption of Individual Local Income Tax on Capital Gains for Newly-Built Rental Houses)
(1) Where a resident prescribed by Presidential Decree, transfers any of the following national housing (including land appurtenant thereto not exceeding twice the gross floor area of the relevant building) after renting it for at least five years, individual local income tax on capital gains on the income accrued from the transfer of the relevant house (hereafter in this Article, referred to as "newly-built rental house"), shall be exempted: <Amended by Act No. 13499, Aug. 28, 2015>
1. Any of the following newly-built rental houses under the Special Act on Private Rental Housing or the Special Act on Public Housing:
(a) A house newly built between August 20, 1999 and December 31, 2001;
(b) A multi-family house newly built as at August 19, 1999, not occupied as at August 20, 1999;
2. Among the following purchased rental houses under the Special Act on Private Rental Housing or the Special Act on Public Housing, a rental house acquired as of August 20, 1999 (limited to where a contract for sale is concluded and a down payment is made during the period between August 20, 1999 and December 31, 2001), and its lease is commenced (limited to a house not occupied at the time it is acquired):
(a) A house newly built as of August 20, 1999;
(b) A house falling under subparagraph 1 (b).
(2) Article 139 (2) through (4) shall apply mutatis mutandis to a newly-built rental house.
[This Article Newly Inserted by Act No. 12175, Jan. 1, 2014]
 Article 140-2 (Reduction of Individual Local Income Tax on Capital Gains for Quasi-Public Rental Housing)
Where a resident is granted a reduction of capital gains tax prescribed in Article 97-5 (1) of the Restriction of Special Taxation Act, the equivalent of 10/100 of the amount reduced shall be reduced as individual local income tax on capital gains.
[This Article Newly Inserted by Act No. 12955, Dec. 31, 2014]
 Article 140-3 (Special Taxation for Land Transferred to Commercial Rental Business Operators)
(1) Where a resident transfers his/her land to a commercial rental business operator defined in subparagraph 8 of Article 2 of the Special Act on Private Rental Housing (hereafter in this Article, referred to as "commercial rental business operator") by no later than December 31, 2018, an amount of tax equivalent to 10/100 of the individual local income tax on capital gains on income accruing from the transfer of relevant land, shall be reduced.
(2) A person who seeks application of paragraph (1) shall apply for tax reduction, as prescribed by Presidential Decree.
(3) Where a commercial rental business operator falls under any of the following cases, he/she shall pay the equivalent of the amount of tax reduced pursuant to paragraph (1) as individual local income tax on capital gains at the time he/she files a tax return for the taxable year in which such ground arises:
1. Where a person is designated as the implementer of a commercial rental housing project pursuant to Article 23 of the Special Act on Private Rental Housing: Where the relevant land fails to obtain designation as a supply promotion district pursuant to Article 22 of the Special Act on Private Rental Housing within the period prescribed by Presidential Decree from the date the relevant land is transferred; or where he/she fails to acquire by construction, commercial rental housing on at least 50/100 of area of the site supplied with compensation within a supply promotion district within the period prescribed by Presidential Decree from the date of designation of a supply promotion district, although the relevant land was designated as a supply promotion district;
2. In cases of a commercial rental business operator other than that referred to in subparagraph 1: Where he/she fails to obtain approval of a project plan pursuant to Article 15 of the Housing Act or a building permit pursuant to Article 11 of the Building Act (hereafter in this Article, referred to as "approval of a project plan, etc.") to construct commercial rental housing on the relevant land within the period prescribed by Presidential Decree from the date the relevant land is transferred; or where the ratio of the gross floor area of the commercial rental housing to the gross floor area of all buildings within the project site, falls below 50/100 within the period prescribed by Presidential Decree from the date of obtaining approval of the project plan, etc., although he/she has obtained approval of the project plan, etc.
(4) Provisions on an amount equivalent to the interest to be paid additionally pursuant to Article 121 (2), shall apply mutatis mutandis where the amount of tax reduced or exempted under paragraph (1) is paid under paragraph (3).
[This Article Newly Inserted by Act No. 14477, Dec. 27, 2016]
 Article 141 (Special Taxation for Unsold Housing Units)
(1) Where a resident has acquired a unit of national housing unsold in lots, prescribed by Presidential Decree (hereafter in this Article, referred to as "unsold housing unit"), during the period between November 1, 1995 and December 31, 1997 (including where a contract for sale is concluded and a down payment is made by no later than December 31, 1997), and transfers it after owning and renting it for at least five years, he/she may, as regards the individual local income tax on capital gains accruing from the transfer of relevant house, select one of the following methods as applicable thereto:
1. Method for calculating the tax base and amount of individual local income tax on capital gains pursuant to the Local Tax Act, and paying the individual local income tax on capital gains, accordingly. In such cases, the rate of the individual local income tax on capital gains shall be 20/1,000, notwithstanding Article 103-3 of the Local Tax Act;
2. Method for calculating the tax base and amount of individual local income tax on global income pursuant to the Local Tax Act, and paying the individual local income tax on global income, accordingly. In such cases, the provisions of Article 19 (2) of the Income Tax Act shall apply mutatis mutandis to calculating the amount of income accrued from the transfer of the relevant house.
(2) For the purposes of paragraph (1), judgment of one house per household falling under any item of Article 89 (1) 3 of the Income Tax Act; application for special taxation; and other matters necessary for the special taxation on an unsold housing unit, shall be prescribed by Presidential Decree. <Amended by Act No. 12506, Mar. 24, 2014>
(3) Where a resident has acquired an unsold national housing unit prescribed by Presidential Decree, during the period between March 1, 1998 and December 31, 1998 (including where a purchase contract is concluded and the contract deposit is paid by no later than December 31, 1998), and transfers it after owning and renting it for at least five years, paragraph (1) shall apply mutatis mutandis to the individual local income tax on income accrued from the transfer of the relevant house.
[This Article Newly Inserted by Act No. 12175, Jan. 1, 2014]
 Article 142 (Special Taxation of Individual Local Income Tax on Capital Gains, etc. for Acquisition of Unsold Local Housing Units)
(1) Notwithstanding Article 103-3 (1) 3 of the Local Tax Act, the tax rate prescribed in Article 103-3 (1) 1 of the same Act shall apply to the income accrued from the transfer of unsold housing units prescribed by Presidential Decree and located outside the Seoul Metropolitan area (hereafter in this Article, referred to as "unsold local housing units"), acquired (including where a purchase contract is concluded and the contract deposit is paid by no later than December 31, 2010) by a resident during the period between November 3, 2008 and December 31, 2010. <Amended by Act No. 12506, Mar. 24, 2014>
(2) For the purposes of Article 90 of the Local Tax Act, no unsold local housing unit subject to paragraph (1) shall be deemed a house owned by the relevant resident. <Amended by Act No. 12506, Mar. 24, 2014>
(3) For the purposes of paragraphs (1) and (2), a final tax return and other necessary matters shall be prescribed by Presidential Decree.
[This Article Newly Inserted by Act No. 12175, Jan. 1, 2014]
 Article 143 (Special Taxation of Individual Local Income Tax on Capital Gains for Acquirers of Unsold Housing Units)
(1) Where a resident or a non-resident having no domestic place of business under Article 120 of the Income Tax Act, first contracts to purchase an unsold housing unit prescribed by Presidential Decree (hereafter in this Article, referred to as "unsold housing unit") located in an area outside Seoul Special Metropolitan City (excluding designated areas under Article 104-2 (1) of the Income Tax Act) with the relevant project entity who supplies houses pursuant to Article 54 of the Housing Act (where a project entity supplies less than 20 housing units, including the relevant housing builder), and then acquires it during the following periods (including where a purchase contract is concluded and the contract deposit is paid by no later than February 11, 2010), an amount of tax equivalent to 100/100 (or 60/100, in cases of areas located in the metropolitan overconcentration control district) of the individual local income tax on capital gains regarding any income accrued from the transfer of such housing unit within five years from the date of acquisition, shall be reduced or exempted: <Amended by Act No. 13805, Jan. 19, 2016>
1. In cases of residents: Period between February 12, 2009 and February 11, 2010;
2. In cases of non-residents: Period between March 16, 2009 and February 11, 2010.
(2) For the purposes of paragraph (1), a house built directly by the person whose construction is commenced (where the date of commencement is uncertain, it shall be based on the date an application for commencement is submitted) and for which approval for use or inspection for use (including approval for temporary use) has been obtained from February 12, 2009, to February 11, 2010, shall be included: Provided, That the same shall not apply in the following cases: <Amended by Act No. 14569, Feb. 8, 2017>
1. A house acquired by a member of a rearrangement project association implementing a redevelopment project or reconstruction project under the Act on the Improvement of Urban Areas and Residential Environments or a small-scale reconstruction project under the Act on Special Cases concerning Unoccupied House or Small-Scale Housing Improvement according to the relevant management and disposal plans;
2. A house demolished and then reconstructed after being lost by fire, collapsing, being worn-out, etc. while occupied or owned.
(3) For the purposes of Article 90 of the Local Tax Act, no unsold local housing unit subject to paragraph (1) or (2) shall be deemed a house owned by the relevant resident. <Amended by Act No. 12506, Mar. 24, 2014>
(4) Notwithstanding Articles 103-3 (1) 3 of the Local Tax Act, the tax rate prescribed in Article 103-3 (1) 1 of the same Act shall apply to the income accrued from the transfer of a house subject to paragraph (1) or (2). <Amended by Act No. 12506, Mar. 24, 2014>
(5) For the purposes of paragraph (1) or (2), application for special taxation and other necessary matters shall be prescribed by Presidential Decree.
[This Article Newly Inserted by Act No. 12175, Jan. 1, 2014]
 Article 144 (Special Taxation of Local Income Tax on Capital Gains on Acquisition of Houses by Non-Residents)
Where a non-resident having no domestic place of business under Article 120 of the Income Tax Act, acquires (including where a purchase contract is concluded and the contract deposit is paid by no later than February 11, 2010) a house other than unsold housing units under Article 143 (1) during the period between March 16, 2009 and February 11, 2010, and transfers it, the amount of tax equivalent to 10/100 of the individual local income tax on capital gains on the income accruing from such transfer, shall be reduced.
[This Article Newly Inserted by Act No. 12175, Jan. 1, 2014]
 Article 145 (Special Taxation of Individual Local Income Tax on Capital Gains for Acquirers of Unsold Housing Units Located in Areas outside Seoul Metropolitan Area)
(1) Where a resident or a non-resident having no domestic place of business under Article 120 of the Income Tax Act, transfers an unsold housing unit prescribed by Presidential Decree (hereafter in this Article, referred to as "unsold housing unit") located in an area outside the Seoul Metropolitan area as at February 11, 2010, within five years from the date of acquisition, and has been acquired (including where a purchase contract is concluded and the contract deposit is paid by no later than April 30, 2011) after first contracting to purchase the same with the relevant business entity, etc. who supply houses as prescribed in Article 54 of the Housing Act, by no later than April 30, 2011, the amount of tax calculated by multiplying the individual local income tax on capital gains on the income from such transfer, by the following reduction rate according to the discount rate of selling price (referring to the selling price notified in the public announcement of invitation to occupants under the Housing Act; hereafter in this Article, the same shall apply), shall be reduced or exempted: <Amended by Act No. 13805, Jan. 19, 2016>
1. Where the discount rate of selling price does not exceed 10/100: 60/100;
2. Where the discount rate of selling price exceeds 10/100, but does not exceed 20/100: 80/100;
3. Where the discount rate of selling price exceeds 20/100: 100/100.
(2) For the purposes of Article 90 of the Local Tax Act, no unsold housing unit subject to paragraph (1) shall be deemed a house owned by the relevant resident. <Amended by Act No. 12506, Mar. 24, 2014>
(3) Notwithstanding Article 103-3 (1) 3 of the Local Tax Act, the tax rate prescribed in Article 103-3 (1) 1 of the same Act shall apply to the income accrued from the transfer of an unsold housing unit subject to the application of paragraph (1). <Amended by Act No. 12506, Mar. 24, 2014>
(4) For the purposes of paragraph (1), the method for calculating the discount rate of selling price of an unsold housing unit, and other necessary matters, shall be prescribed by Presidential Decree.
[This Article Newly Inserted by Act No. 12175, Jan. 1, 2014]
 Article 146 (Special Taxation of Individual Local Income Tax on Capital Gains for Acquirers of Unsold Housing Units after Completion)
(1) Where a resident or a non-resident having no domestic place of business under Article 120 of the Income Tax Act (hereafter in this Article, referred to as "non-resident"), transfers any of the following houses, the amount of tax equivalent to 50/100 of individual local income tax on capital gains on the income accrued from the transfer of the house within five years from the date of acquisition, shall be reduced (limited to a house satisfying the requirement referred to in subparagraph 1): <Amended by Act No. 13499, Aug. 28, 2015; Act No. 13805, Jan. 19, 2016>
1. An unsold housing unit after completion prescribed by Presidential Decree (hereafter in this Article, referred to as "unsold housing unit after completion") which a project entity who supplies housing pursuant to Article 54 of the Housing Act or other project implementers prescribed by Presidential Decree (hereafter in this Article, referred to as "project entity, etc."), has leased for at least two years by contracting to lease, by no later than December 31, 2011, and which a resident or non-resident has acquired after first contracting to purchase the same with the relevant project entity, etc.;
2. An unsold housing unit after completion that a resident or non-resident acquired by first contracting to purchase the same with a project entity, etc., has leased for at least five years (limited to where a resident or non-resident contracts to lease, by no later than December 31, 2011, after completing business registration under Article 168 of the Income Tax Act and the registration of rental business operator under Article 5 of the Special Act on Private Rental Housing).
(2) For the purposes of Article 90 of the Local Tax Act, no house subject to paragraph (1) shall be deemed a house owned by the relevant resident. <Amended by Act No. 12506, Mar. 24, 2014>
(3) Notwithstanding Article 103-3 (1) 3 of the Local Tax Act, the tax rate prescribed in Article 103-3 (1) 1 of the same Act shall apply to the income accrued from transfer of a house subject to paragraph (1). <Amended by Act No. 12506, Mar. 24, 2014>
(4) For the purposes of paragraph (1), procedures for verifying an unsold housing unit after completion and the rental period thereof, and other necessary matters, shall be prescribed by Presidential Decree.
[This Article Newly Inserted by Act No. 12175, Jan. 1, 2014]
 Article 147 (Special Taxation of Individual Local Income Tax on Capital Gains for Acquirers of Unsold Housing Units)
(1) Where a national first contracts to purchase (limited to where a contract deposit is paid) an unsold housing unit prescribed by Presidential Decree as at September 24, 2012, the acquisition value of which does not exceed 900 million won (hereafter in this Article, referred to "unsold housing unit"), with the relevant project entity supplying housing under Article 54 of the Housing Act or any other project implementer prescribed by Presidential Decree, or acquires a house through such contract during the period between September 24, 2012 and December 31, 2012, individual local income tax on capital gains on the income accrued from the transfer of such housing unit within five years from the date of acquisition, shall be exempted. <Amended by Act No. 13805, Jan. 19, 2016>
(2) For the purposes of Article 103-3 (1) 3 of the Local Tax Act, no house subject to paragraph (1) shall be deemed a house owned by the relevant resident. <Amended by Act No. 12506, Mar. 24, 2014>
(3) For the purposes of paragraph (1), application for special taxation and other necessary matters shall be prescribed by Presidential Decree.
[This Article Newly Inserted by Act No. 12175, Jan. 1, 2014]
 Article 148 (Special Taxation of Individual Local Income Tax on Capital Gains for Acquirers of Newly-Built Houses, etc.)
(1) Where a resident or a non-resident acquires a newly-built house, an unsold housing unit, or a house classified as one house per household, the acquisition value of which does not exceed 600 million won or the gross floor area (area for exclusive use, in cases of multi-family houses) of which does not exceed 85 square meters and which is prescribed by Presidential Decree, by first contracting to purchase the same with a project entity supplying housing under Article 54 of the Housing Act during the period between April 1, 2013 and December 31, 2013, or any other person prescribed by Presidential Decree and acquiring it under the same contract (including where the contract deposit is paid by December 31, 2013, after contracting to purchase the same), individual local income tax on capital gains accrued from the transfer of the relevant house within five years from the date of acquisition thereof, shall be exempted. <Amended by Act No. 13805, Jan. 19, 2016>
(2) For the purposes of Article 103-3 (1) 3 of the Local Tax Act, no house subject to paragraph (1) shall be deemed a house owned by the relevant resident. <Amended by Act No. 12506, Mar. 24, 2014>
(3) Paragraph (1) shall not apply to an area prescribed by Presidential Decree wherein the price of real estate has risen or is likely to rise sharply, in light of the inflation of the national consumer prices and of the national trade prices of housing.
(4) Any person who seeks application of paragraph (1) shall apply for reduction or exemption, as prescribed by Presidential Decree.
(5) For the purposes of paragraph (1), application for special taxation and other necessary matters shall be prescribed by Presidential Decree.
[This Article Newly Inserted by Act No. 12175, Jan. 1, 2014]
SECTION 11 Special Provisions on Other Local Income Taxes
 Article 149 (Reduction or Exemption of Tax on Income from Forest Development)
(1) As for income accrued by no later than December 31, 2018, from the deforestation or transfer of a forest or a seed-collection forest newly-afforested by a national according to a forest management plan or a project for special forest business zone under the Creation and Management of Forest Resources Act (including any designated development projects in a designated development area provided for in Article 2 of the Addenda to the amended Forestry Act (Act No. 4206), which is the designated development area designated by the former Forestry Act prior to the enforcement of the amended Forestry Act), or a forest protection area afforested by a national for at least ten years under Article 7 of the Forest Protection Act, an amount of tax equivalent to 50/100 of individual local income tax, shall be reduced. <Amended by Act No. 14477, Dec. 27, 2016>
(2) Any person who seeks application of paragraph (1) shall apply for reduction or exemption, as prescribed by Presidential Decree.
[This Article Newly Inserted by Act No. 12175, Jan. 1, 2014]
 Article 150 (Tax Credit for Third Party Logistics Expense)
(1) Where the third party logistics expense incurred by a national who engages in manufacturing business and satisfies each of the following requirements each taxable year until the taxable year that ends as at December 31, 2018, exceeds the third party logistics expense incurred for the immediately preceding taxable year, the equivalent of 3/1,000 (or 5/1,000 in cases of a small or medium enterprise) of such excess, shall be deducted from individual local income tax (limited to individual local income tax on business income): Provided, That where the amount deducted exceeds 10/100 of the individual local income tax for the pertinent taxable year, 10/100 shall be the limit: <Amended by Act No. 14477, Dec. 27, 2016>
1. The third party logistics expense incurred for each taxable year shall be at least 30/100 of the logistics expense incurred for each taxable year;
2. The ratio of the third party logistics expense to the logistics expense incurred for the pertinent taxable year shall not be lower than the ratio for the immediately preceding taxable year.
(2) Where the third party logistics expense incurred in the relevant taxable year, exceeds 30/100 of the logistics expenses incurred in the relevant taxable year when the third party logistics expense incurred in the immediately preceding taxable year is below 30/100 of the logistics expenses incurred in the immediately preceding taxable year or nonexistent, notwithstanding paragraph (1), the equivalent of 3/1,000 (or 5/1,000 in cases of a small or medium enterprise) of such excess, shall be deducted from individual local income tax (limited to individual local income tax on business income): Provided, That where the amount deducted exceeds 10/100 of individual local income tax for the relevant taxable year, 10/100 shall be the limit. <Amended by Act No. 14477, Dec. 27, 2016>
(3) A national who seeks application of paragraph (1) or (2) shall apply for a tax credit, as prescribed by Presidential Decree.
[This Article Newly Inserted by Act No. 12175, Jan. 1, 2014]
 Article 151 (Tax Credit on Aligned Educational Expenses, etc. for Universities or Colleges)
(1) Where a school prescribed in Article 2 of the Higher Education Act (hereafter in this Article, referred to as "university or college"), establishes and operates a school prescribed by Presidential Decree as a school that provides industrial education or where a high school, etc. aligned to industry demand establishes and operates a vocational education and training curriculum or department according to a contract with a national pursuant to Article 8 of the Industrial Education Enhancement and Industry-Academia-Research Cooperation Promotion Act, and the relevant national pays expenses (hereafter in this Article, referred to as "aligned educational expenses") as its operating expenses by December 31, 2019, Article 102 shall apply mutatis mutandis. In such cases, "general research and human resources development expenses" shall be construed as "aligned educational expenses." <Amended by Act No. 14477, Dec. 27, 2016>
(2) Where a national contributes to a university, college, or high school, etc. aligned to industry demand, the facilities for research and human resources development prescribed by Presidential Decree by December 31, 2019, Article 103 shall apply mutatis mutandis. <Amended by Act No. 14477, Dec. 27, 2016>
(3) For the purposes of paragraphs (1) and (2), where a national pays or contributes to a university or college located in Seoul Metropolitan area, he/she shall be deemed to have paid or contributed 5/100 of the relevant amount.
(4) Where a national who has entered into a prior employment contract, etc. prescribed by Presidential Decree with a high school, etc. aligned to industry demand, conducts vocational education and training to enrolled students in the relevant high school, etc. aligned to industry demand, and pays them expenses prescribed by Presidential Decree, such as field training allowances (hereafter in this Article, referred to as "field training allowances, etc.") by December 31, 2019, Article 102 shall apply mutatis mutandis. In such cases, "general research and human development expenses" shall be construed as "field training allowances, etc." <Amended by Act No. 14477, Dec. 27, 2016>
[This Article Newly Inserted by Act No. 12175, Jan. 1, 2014]
 Article 152 (Tax Reduction or Exemption for Overseas Korean Enterprises on their Return to Korea)
(1) Where a person prescribed by Presidential Decree, including Korean nationals, falls under any of the following cases and commences business or establishes a new place of business in the Republic of Korea (excluding the Seoul Metropolitan area; hereafter in this Article, the same shall apply) by not later than December 31, 2018, the individual local income tax shall be reduced or exempted pursuant to paragraph (2) or (3): <Amended by Act No. 14477, Dec. 27, 2016>
1. Where he/she relocates his/her place of business operated overseas for at least two years, to the Republic of Korea, as prescribed by Presidential Decree;
2. Where he/she is a small or medium enterprise that returns to the Republic of Korea, partially downsizing or maintaining his/her place of business operated overseas for at least two years, or a middle-standing enterprise prescribed by Presidential Decree with no place of business in the Republic of Korea (including an enterprise with a place of business in the Republic of Korea, in cases of partial downsizing prescribed by Presidential Decree, such as reducing output).
(2) In cases falling under paragraph (1) 1, an amount of tax equivalent to 100/100 of the individual local income tax on the income to be accrued in the place of business after such relocation, shall be exempted in the taxable year in which the first income accrues from the relevant place of business from the date of relocation (where no income accrues until the taxable year falling on the fifth anniversary from the date of relocation, the taxable year falling on the fifth anniversary from the date of relocation) and also within the four subsequent taxable years for the date the following taxable year commences; and an amount of tax equivalent to 50/100 of the individual local income tax on the income, shall be reduced within the two subsequent taxable years thereafter. <Amended by Act No. 14477, Dec. 27, 2016>
(3) In cases falling under paragraph (1) 2, an amount of tax equivalent to 100/100 of the individual local income tax on the income to be accrued in the place of business after so returning, shall be exempted in the taxable year in which the first income accrues from the relevant place of business after the date of return (where no income accrues until the taxable year falling on the fifth anniversary from the date of return, the taxable year falling on the fifth anniversary from the date of return) and also within the two subsequent taxable years for the date the following taxable year commences; and an amount of tax equivalent to 50/100 of the individual local income tax on the income, shall be reduced within the two subsequent taxable years thereafter. <Amended by Act No. 14477, Dec. 27, 2016>
(4) Where a national granted a reduction or exemption of individual local income tax under paragraph (1), falls under any of the following cases, he/she shall pay the amount of tax calculated as prescribed by Presidential Decree, as individual local income tax, when filing a tax return for the taxable year in which such ground arises:
1. Where he/she closes his/her business or dissolves the corporation within three years from the date the business is commenced by relocating or returning the overseas place of business to the Republic of Korea: Provided, That this shall not apply to the cases of merger, split-off, or merger after split-off;
2. Where he/she fails to commence a business by relocating or returning the overseas place of business to the Republic of Korea, as prescribed by Presidential Decree.
(5) Article 122 (4) shall apply mutatis mutandis to an additional amount equivalent to interest when paying the amount of individual local income tax reduced or exempted under paragraph (1) pursuant to paragraph (4).
(6) For the purposes of paragraphs (1) through (5), matters concerning the application for reduction or exemption of an amount of tax, and other necessary matters, shall be prescribed by Presidential Decree.
[This Article Newly Inserted by Act No. 12175, Jan. 1, 2014]
 Article 153 (Reduction or Exemption of Individual Local Income Tax, etc. for Foreign Investment)
(1) A foreign investment to operate any business falling under any subparagraph of Article 121-2 (1) of the Restriction of Special Taxation Act (referring to foreign investment defined in Article 2 (1) 4 of the Foreign Investment Promotion Act; hereafter in this Article, the same shall apply), which meets the standards prescribed by Presidential Decree, shall be entitled to a reduction or exemption of individual local income tax under paragraphs (2) through (5) and (12), respectively.
(2) The reduction or exemption of individual local income tax for a foreign-capital-invested company defined in Article 2 (1) 6 of the Foreign Investment Promotion Act (hereafter in this Article, referred to as "foreign-capital-invested company"), shall be granted only to income derived by operating a business eligible for reduction or exemption under paragraph (1) (income eligible for reduction or exemption of business referred to in Article 121-2 (1) 1 of the Restriction of Special Taxation Act, shall be prescribed by Presidential Decree); and the period of reduction or exemption and the amount of tax eligible for reduction or deduction, shall be as follows. In such cases, when calculating the amount of tax eligible for reduction or deduction, where the foreign-capital-invested company merges with a domestic corporation (excluding a foreign-capital-invested company which is in the period of reduction or exemption) during the period of reduction or exemption, and thereby the foreign investment ratio (referring to a foreign investment ratio calculated as prescribed by Presidential Decree, based upon the types, etc. of stocks issued by the foreign-capital-invested company; hereafter in this Chapter, the same shall apply) in the relevant merged corporation is decreased, the foreign investment ratio of the foreign-capital-invested company before it is merged, shall apply: <Amended by Act No. 14477, Dec. 27, 2016>
1. Income derived from a business eligible for reduction or exemption under Article 121-2 (1) 1 and 2 of the Restriction of Special Taxation Act, shall be entitled to the reduction of the whole amount calculated by multiplying the equivalent of individual local income tax on such business income (referring to the amount calculated by multiplying the aggregate of the amount of tax calculated, by a percentage of the gross tax base which is represented by such income derived by operating the business referred to in the subparagraphs of paragraph (1)), by the ratio of foreign investment (hereafter in this paragraph and paragraph (8), referred to as "amount of tax entitled to reduction") for the taxable years ending within five years from the commencement date of the taxable year in which the first income accrues from such business after such business commences (when no income accrues from the relevant business until the taxable year falling on the fifth anniversary from the date such business commences, the taxable year falling on the fifth anniversary); and an amount of tax equivalent to 50/100 of the amount of tax entitled to reduction, shall be reduced for the two subsequent taxable years thereafter, respectively;
2. Income derived from a business eligible for reduction or exemption under Article 121-2 (1) 2-2 through 2-9 and 3 of the Restriction of Special Taxation Act, shall be entitled to the reduction of the whole amount of the amount of tax entitled to reduction for the taxable years ending within three years from the commencement date of the taxable year in which the first income accrues from such business after the date such business commences (when no income accrues from the relevant business until the taxable year falling on the fifth anniversary from the date such business commences, the taxable year falling on the fifth anniversary); and an amount of tax equivalent to 50/100 of the amount of tax entitled to reduction or exemption, shall be reduced for the two subsequent taxable years thereafter, respectively.
(3) Any foreign-capital-invested company that intends to be entitled to tax reduction or exemption under paragraph (2) or (8), shall apply for tax reduction or exemption, to the head of the relevant local government, by no later than the closing date of the taxable year in which the business of relevant foreign-capital-invested company commences; and where any amendment has been made to business details for which the decision on the reduction or exemption of individual local income tax is made under paragraph (4), if it intends to have any reduction or exemption applied to the amended business, it shall apply for amendment to details of tax reduction or exemption, to the head of the relevant local government, by no later than the second anniversary from the date a ground for the relevant amendment arises; and where a decision on amendment to details of tax reduction or exemption is made thereon, the details of relevant decision on amendment shall apply only to the remainder of the original reduction or exemption period: Provided, That a person who has applied for reduction or exemption to the Minister of Strategy and Finance under Article 121-2 of the Restriction of Special Taxation Act, shall be deemed to have applied therefor, to the head of the relevant local government.
(4) Upon receipt of an application for reduction or exemption or for amendment to details of reduction or exemption of individual local income tax under paragraph (3), the head of a local government shall decide on whether the amount of tax can be reduced or exempted, the details of reduction or exemption can be amended, or the business can be entitled to the tax reduction or exemption in consultation with the head of the related central government agency, and shall notify the applicant thereof, accordingly: Provided, That the same shall not apply where a person has applied for reduction or exemption, to the Minister of Strategy and Finance under the proviso to paragraph (3). <Amended by Act No. 14477, Dec. 27, 2016>
(5) Paragraphs (2) and (8) shall not apply to the foreign investment made under Article 2 (1) 8 (g) of the Foreign Investment Promotion Act, or Article 2 (1) 4 (a) (ii), 5 (2) 1, or 6 of the same Act. <Amended by Act No. 13854, Jan. 27, 2016>
(6) Where a foreign-capital-invested company obtains a decision on reduction or exemption under paragraph (4) by applying for reduction or exemption after an expiry of the deadline for application for reduction or exemption under paragraph (3), paragraphs (1), (2), and (8) shall apply only to the taxable year in which the date of such application falls, and to the remainder of a reduction or exemption period thereafter. In such cases, where any amount of tax has already been paid by the foreign-capital-invested company prior to a decision on reduction or exemption under paragraph (4), the relevant amount of tax shall not be refunded.
(7) For the purposes of this Article, in any of the following foreign investment, the equivalent of the holding ratio (where the holding ratio is less than 5/100, it shall be deemed 5/100) of stocks or equity shares (hereafter in this Chapter, referred to as "stocks, etc.") calculated as prescribed by Presidential Decree, the equivalent of the loan, or an amount invested by a foreigner, shall not be deemed eligible for tax reduction or exemption: <Amended by Act No. 14477, Dec. 27, 2016>
1. Where a foreign corporation or foreign enterprise (hereafter in this paragraph, referred to as "foreign corporation, etc.") makes a foreign investment and falls under any of the following cases:
(a) Where a Korean national (excluding a person permanently residing overseas who has obtained a permanent residency or similar sojourn permit corresponding to the permanent residency in his/her domicile) or a Korean corporation (hereafter in this paragraph, referred to as "Korean national, etc."), holds directly or indirectly at least 5/100 of the voting stocks, etc. of the relevant foreign corporation, etc.;
(b) Where a Koran national, etc. is the stockholder who has appointed the representative director or a majority of directors of the relevant foreign corporation, etc. unilaterally or pursuant to an agreement, contract, etc. with other stockholders;
2. Where any of the following persons is loaning money to a foreign investor defined in Article 2 (1) 5 of the Foreign Investment Promotion Act:
(a) A foreign-capital-invested company;
(b) A Korean national, etc. directly or indirectly holding at least 5/100 of the voting stocks, etc. of the foreign-capital-invested company;
(c) A Korean national, etc. who is the stockholder who has appointed the representative director or a majority of directors of the foreign-capital-invested company unilaterally or pursuant to an agreement, contract, etc. with other stockholders;
3. Where a foreigner makes a foreign investment through a state or region prescribed by Presidential Decree among the states or regions that have not concluded tax treaties defined in Article 2 (1) 2 of the Adjustment of International Taxes Act or investment guarantee agreements with the Republic of Korea.
(8) With respect to foreign investment falling under a method prescribed by Presidential Decree, such as acquisition of business, among the foreign investment in the business prescribed in Article 121-2 (1) 1 of the Restriction of Special Taxation Act, notwithstanding the period of reduction or exemption and the rate of reduction or exemption prescribed in paragraph (2), the reduction or exemption of individual local income tax for a foreign-capital-invested company shall be granted only to the income accruing from operating a business entitled to reduction or exemption under Article 121-2 (1) 1 of the same Act, but 50/100 of the amount of tax entitled to the reduction or exemption for the taxable year ending within three years from the commencement date of the taxable year in which the first income accrues from such business (when no income accrues from the relevant business by the taxable year falling on the fifth anniversary from the date such business commences, the taxable year falling on the fifth anniversary); and 30/100 of the amount of tax entitled to the reduction or exemption shall be reduced for the two subsequent taxable years thereafter, respectively. <Amended by Act No. 14477, Dec. 27, 2016>
(9) Where the initial investment (including capital increase) is not made by the third anniversary from the date the first notice concerning the decision on the reduction or exemption of individual local income tax is served after reporting the foreign investment, the effect of the decision on the reduction or exemption of individual local income tax provided for in paragraph (4), shall be invalid; and where the initial investment is made within three years from the date the first notice concerning the decision on the reduction or exemption of individual local income tax is served, but it fails to commence business by the fifth anniversary from the date the first notice concerning the decision on the reduction or exemption of tax is served, paragraphs (2), (8), and (15) of this Article shall apply, deeming the business to have commenced on the fifth anniversary from the date the first notice concerning the decision on the reduction or exemption of tax is served. <Amended by Act No. 14477, Dec. 27, 2016>
(10) Where the sum of the individual local income tax reduced or exempted during the period of reduction or exemption to which paragraph (2) or (8) applies, exceeds the aggregate of the following amounts, the ceiling on the tax reduction or exemption (hereafter in this Article, referred to as "reduction or exemption ceiling") shall be such aggregate: <Amended by Act No. 12506, Mar. 24, 2014; Act No. 14477, Dec. 27, 2016>
1. A ceiling based on the investment of an amount classified as follows:
(a) In cases falling under Article 121-2 (1) 1 or 2 of the Restriction of Special Taxation Act: 50/1,000 of the cumulative foreign investments prescribed by Presidential Decree (hereafter in this paragraph, referred to as "cumulative foreign investments");
(b) In cases falling under any of Article 121-2 (1) 2-2 through 2-9, and 3, and (10) 1 of the Restriction of Special Taxation Act: 40/1,000 of the cumulative foreign investments;
2. The aggregate of the following amounts based on employment: Provided, That the equivalent of 20/100 of the cumulative foreign investments shall be the ceiling; however, in cases falling under Article 121-2 (1) 1 or 2 the Restriction of Special Taxation Act, the equivalent of 40/100 of the cumulative foreign investments shall be the ceiling; and in cases falling under paragraph (1) 2-2 through 2-9, or 3, or (12) 1 of the same Article, the equivalent of 30/100 of the cumulative foreign investments shall be the ceiling:
(a) Number of graduates from high schools, etc. aligned to industry demand among workers at ordinary times at the relevant foreign-capital-invested company in the relevant taxable year × two million won;
(b) Number of youth workers, workers with disabilities, and workers aged at least 60 among workers at ordinary times at the relevant foreign-capital-invested company other than those referred to in item (a) in the relevant taxable year x 1.5 million won;
(c) (Number of workers at ordinary times in the relevant taxable year - number of graduates referred to in item (a) - number of youth workers, workers with disabilities, and workers aged at least 60 referred to in item (b) x one million won.
(11) When applying the reduction or exemption ceiling to individual local income tax to be reduced or exempted each taxable year pursuant to paragraph (2) or (8), an amount prescribed in paragraph (10) 1 shall be first applied and then an amount prescribed in paragraph (10) 2 shall be applied.
(12) Where the number of workers at ordinary times each taxable year during the period from the end of the taxable year in which a tax reduction or exemption of individual local income tax was granted until the end of the taxable year falling on the second anniversary from the end of the taxable year in which the tax reduction or exemption was granted, has decreased as compared with the number of workers at ordinary times in the taxable year in which the tax reduction or exemption was granted, a foreign-capital-invested company granted a reduction or exemption of its individual local income tax under paragraph (10) 2, shall pay the equivalent of the amount of tax reduced or exempted as individual local income tax, as prescribed by Presidential Decree.
(13) For the purposes of paragraphs (10) and (12), the scope of workers at ordinary times; method for calculating the number of workers at ordinary times; and other necessary matters, shall be prescribed by Presidential Decree.
(14) Where a foreign-capital-invested company keeps separate accounts of the business referred to in Article 121-2 (1) 1 of the Restriction of Special Taxation Act and business other than that referred to in the same Article 121-2 (1) 1 among business referred to in subparagraphs of Article 121-2 (1) of the same Act at the same place of business, by applying mutatis mutandis Article 143 of the same Act, the reduction or exemption prescribed in paragraph (2) of this Article, shall apply to each of such business: Provided, That the period of reduction or exemption for each business shall be reckoned from the commencement date of the taxable year in which the first income entitled to reduction or exemption accrues at the relevant place of business (where no income accrues from the relevant business by the taxable year falling on the fifth anniversary from the date the relevant business commences, the taxable year falling on the fifth anniversary). <Newly Inserted by Act No. 14477, Dec. 27, 2016>
(15) Where the total of the individual local income tax reduced or exempted during the period of reduction or exemption to which paragraph (2) or (8) applies, exceeds 10/100 of the aggregate of amounts prescribed in subparagraphs of Article 121-2 (14) of the Restriction of Special Taxation Act, individual local income tax shall be reduced by up to 10/100 of such aggregate (hereafter in this Article, referred to as "reduction ceiling"); and the application of the reduction ceiling shall be subject to paragraphs (15) through (17) of the same Article. <Newly Inserted by Act No. 14477, Dec. 27, 2016>
(16) When a tax return is filed for the taxable year in which a ground falling under any subparagraph of Article 121-5 (1) of the Restriction of Special Taxation Act arises, a foreign-capital-invested company granted a reduction of or exemption of individual local income tax under paragraph (2) or (8), shall pay as individual local income tax, an amount calculated by adding an additional charge equivalent to interest calculated as prescribed by Presidential Decree to the amount of tax calculated as prescribed by Presidential Decree; and such amount of tax shall be deemed the amount of tax payable pursuant to Article 95 of the Local Tax Act.
[This Article Newly Inserted by Act No. 12175, Jan. 1, 2014]
 Article 154 (Reduction or Exemption of Individual Local Income Tax for Enterprises that Occupy Jeju Science Park)
(1) Where enterprises that occupy the Jeju Science Park designated under Article 161 of the Special Act on the Establishment of Jeju Special Self-Governing Province and the Development of Free International City (hereafter in this Chapter, referred to as the "Jeju Science Park") by December 31, 2018, operate business prescribed by Presidential Decree, such as biotech industry or information and communications industry (hereafter in this Article, referred to as "business entitled to tax reduction or exemption"), regarding the income accruing from the business entitled to tax reduction or exemption, an amount of tax equivalent to 100/100 of the individual local income tax for the three taxable years from the commencement date of the taxable year in which the first income accrues from the relevant business after the date the relevant business commences (where no income accrues from the relevant business by the taxable year falling on the fifth anniversary from the date the relevant business commences, the taxable year falling on the fifth anniversary); and an amount of tax equivalent to 50/100 of the individual local income tax for the two subsequent taxable years thereafter, shall be reduced or exempted. <Amended by Act No. 13426, Jul. 24, 2015; Act No. 14477, Dec. 27, 2016>
(2) Where the sum of the individual local income tax reduced or exempted during the period of reduction or exemption to which paragraph (1) applies, exceeds the aggregate of the amounts prescribed in subparagraphs 1 and 2, the ceiling on the tax reduction or exemption (hereafter in this Article, referred to as "reduction or exemption ceiling"), shall be such aggregate: Provided, That where the enterprise operates a service business prescribed by Presidential Decree (hereafter in this Article, referred to as "service business"); and where the sum of the individual local income tax reduced or exempted for income accruing from the relevant service business during the period of reduction or exemption to which paragraph (1) applies, exceeds the greater of the aggregate of the amounts prescribed in subparagraphs 1 and 2, and of the amount prescribed in subparagraph 3, the amount of tax may be reduced or exempted by up to such greater amount: <Amended by Act No. 14477, Dec. 27, 2016>
1. 5/100 of the cumulative investments prescribed by Presidential Decree;
2. The lesser of the following amounts:
(a) Number of workers at ordinary times at places of business in the Jeju Science Park in the relevant taxable year (hereafter in this Article, referred to as "places of business entitled to tax reduction or exemption") x one million won;
(b) 2/100 of the cumulative investments prescribed in subparagraph 1;
3. The lesser of the following amounts:
(a) Number of workers at ordinary times at places of business entitled to tax reduction or exemption, in the relevant taxable year x two million won;
(b) 10/100 of the cumulative investments prescribed in subparagraph 1.
(3) When applying the reduction or exemption ceiling to the individual local income tax to be reduced or exempted each taxable year pursuant to paragraph (1), an amount prescribed in paragraph (2) 1 shall be first applied and then an amount prescribed in paragraph (2) 2 shall be applied.
(4) Where the number of workers at ordinary times each taxable year at the place of business entitled to a reduction or exemption of the individual local income tax during the period from the end of the taxable year in which the tax reduction or exemption was granted, until the end of the taxable year falling on the second anniversary from the end of the taxable year in which the tax reduction or exemption was granted, has decreased as compared with the number of workers at ordinary times in the taxable year in which the tax reduction or exemption was granted, an enterprise granted a reduction or exemption of individual local income tax under paragraph (2) 2 or 3, shall pay the equivalent of the amount of tax reduced or exempted as individual local income tax, as prescribed by Presidential Decree. <Amended by Act No. 14477, Dec. 27, 2016>
(5) For the purposes of paragraphs (2) and (4), the scope of workers at ordinary times; method for calculating the number of workers at ordinary times; and other necessary matters, shall be prescribed by Presidential Decree.
(6) Any person who seeks application of paragraph (1) shall apply for reduction or exemption, as prescribed by Presidential Decree.
(7) An enterprise to which the reduction or exemption ceiling for service business applies pursuant to paragraph (2), shall keep separate accounts of service business and other types of business, by applying mutatis mutandis Article 143 of the Restriction of Special Taxation Act. <Newly Inserted by Act No. 14477, Dec. 27, 2016>
[This Article Newly Inserted by Act No. 12175, Jan. 1, 2014]
 Article 155 (Reduction or Exemption of Individual Local Income Tax for Enterprises that Occupy Jeju Investment Promotion Zone or Jeju Free Trade Zone)
(1) With respect to investment that meets the standards prescribed by Presidential Decree as investment to conduct any of the following businesses (hereafter in this Article, referred to as "business entitled to tax reduction or exemption"), individual local income tax shall be reduced or exempted pursuant to paragraphs (2) through (6): <Amended by Act No. 13426, Jul. 24, 2015; Act No. 14477, Dec. 27, 2016>
1. Business conducted at a place of business in the relevant area by enterprises that occupy the Jeju Investment Promotion Zone designated pursuant to Article 162 of the Special Act on the Establishment of Jeju Special Self-Governing Province and the Development of Free International City (hereafter in this Article, referred to as the "Jeju Investment Promotion Zone"), by no later than December 31, 2018;
2. Business conducted at a place of business in the relevant area by enterprises that occupy the Free Trade Zone designated in Jeju Special Self-Governing Province pursuant to Article 4 of the Act on Designation and Management of Free Trade Zones (hereafter in this Chapter, referred to as the "Jeju Free Trade Zone"), by no later than December 31, 2018;
3. Development projects collectively planned, financed, designed, constructed, marketed, leased, sold in lots, etc. by the development project entity of the Jeju Investment Promotion Zone to develop the Jeju Investment Promotion Zone.
(2) With respect to income accruing from business entitled to tax reduction or exemption falling under any subparagraph of paragraph (1), in the three subsequent taxable years from the commencement date of the taxable year (where no income accrues from the relevant business by the taxable year falling on the fifth anniversary from the date the business commences, the taxable year falling on the fifth anniversary) in which the first income accrues from the relevant business entitled to tax reduction or exemption after the date the relevant business commences, in cases falling under paragraph (1) 1 and 2, an amount of tax equivalent to 100/100 of the individual local income tax, and in cases falling under paragraph (1) 3, an amount of tax equivalent to 50/100 of the individual local income tax, shall be reduced or exempted, respectively; and in the two subsequent taxable years thereafter, in cases falling under paragraph (1) 1 and 2, an amount of tax equivalent to 50/100 of the individual local income tax, and in cases falling under paragraph (1) 3, an amount of tax equivalent to 25/100 of the individual local income tax, shall be reduced or exempted, respectively.
(3) Where the sum of the individual income tax reduced or exempted during the period of reduction or exemption to which paragraph (2) applies, exceeds the aggregate of the amounts prescribed in subparagraphs 1 and 2, the ceiling on the tax reduction or exemption (hereafter in this Article, referred to as "reduction or exemption ceiling"), shall be such aggregate: Provided, That where the enterprise operates a service business prescribed by Presidential Decree (hereafter in this Article, referred to as "service business"); and where the sum of the individual local income tax reduced or exempted for income accruing from the relevant service business during the period of reduction or exemption to which paragraph (2) applies, exceeds the greater of the aggregate of the amounts prescribed in subparagraphs 1 and 2, and of the amount prescribed in subparagraph 3, the amount of tax may be reduced or exempted by up to such greater amount: <Amended by Act No. 14477, Dec. 27, 2016>
1. 5/100 of the cumulative investments prescribed by Presidential Decree;
2. The lesser of the following amounts:
(a) Number of workers at ordinary times at a place of business under any subparagraph of paragraph (1) in the relevant taxable year (hereafter in this Article, referred to as "place of business entitled to tax reduction or exemption") x one million won;
(b) 2/100 of the cumulative investments prescribed in subparagraph 1;
3. The lesser of the following amounts:
(a) Number of workers at ordinary times at places of business entitled to tax reduction or exemption, in the relevant taxable year x two million won;
(b) 10/100 of the cumulative investments prescribed in subparagraph 1.
(4) When applying the reduction or exemption ceiling to the individual local income tax to be reduced or exempted each taxable year pursuant to paragraph (2), an amount prescribed in paragraph (3) 1 shall be first applied and then an amount prescribed in paragraph (3) 2 shall be applied.
(5) Where the number of workers at ordinary times each taxable year at the place of business entitled to a reduction or exemption of individual local income tax during the period from the end of the taxable year in which the tax reduction or exemption was granted, until the end of the taxable year falling on the second anniversary from the end of the taxable year in which the tax reduction or exemption was granted, has decreased as compared with the number of workers at ordinary times in the taxable year in which the tax reduction or exemption was granted, an enterprise granted a reduction or exemption of individual local income tax under paragraph (3) 2 or 3, shall pay the equivalent of the amount of tax reduced or exempted as individual local income tax, as prescribed by Presidential Decree. <Amended by Act No. 14477, Dec. 27, 2016>
(6) For the purposes of paragraphs (3) and (5), the scope of workers at ordinary times; method for calculating the number of workers at ordinary times; and other necessary matters, shall be prescribed by Presidential Decree.
(7) Any person who seeks application of paragraph (2) shall apply for tax reduction or exemption, as prescribed by Presidential Decree.
(8) An enterprise to which the reduction or exemption ceiling for service business applies pursuant to the proviso to paragraph (3), shall keep separate accounts of service business and other types of business, by applying mutatis mutandis Article 143 of the Restriction of Special Taxation Act. <Newly Inserted by Act No. 14477, Dec. 27, 2016>
(9) Where any ground provided for in the subparagraphs of Article 121-12 (1) of the Restriction of Special Taxation Act, arises to a company that occupies the Jeju Investment Promotion Zone or Jeju Free Trade Zone, the reduced or exempted portion of individual local income tax for such company that occupies the Jeju Investment Promotion Zone or Jeju Free Trade Zone, shall be collected as a penalty, as prescribed by Presidential Decree.
[This Article Newly Inserted by Act No. 12175, Jan. 1, 2014]
 Article 156 (Reduction or Exemption of Individual Local Income Tax for Start-Up Enterprises, etc. Located in Enterprise City Development Zones, etc.)
(1) Individual local income tax shall be reduced or exempted for the investment made to operate any of the following businesses (hereafter in this Article, referred to as "business entitled to tax reduction or exemption") and for which the type of the business and the amount of the investment meet the standards prescribed by Presidential Decree pursuant to paragraphs (2) through (8): <Amended by Act No. 12506, Mar. 24, 2014; Act No. 12955, Dec. 31, 2014; Act No. 14477, Dec. 27, 2016>
1. Business operated in a place of business by an enterprise which commences business or establishes a place of business (excluding where an existing place of business is relocated) in an enterprise city development zone by no later than December 31, 2018;
2. Business operated by an enterprise city development project entity that implements such project defined in subparagraph 3 of Article 2 of the Special Act on the Development of Enterprise Cities;
3. Business operated by an enterprise (including nationals operating tourist accommodation business prescribed in the Tourism Promotion Act, comprehensive resort business, or livestock-breeding business, where a person is selected as the development project implementer for an abandoned mine area promotion district designated under the Special Act on the Assistance to the Development of Abandoned Mine Areas, among the regional development project zones deemed under Article 4 of the Addenda to the Regional Development Assistance Act (Act No. 12737)), which is incorporated or which newly establishes a place of business (excluding where an existing place of business is relocated) by no later than December 31, 2018, in a regional development project zone designated under Article 11 of the Regional Development Assistance Act (limited to regional development projects falling under Article 7 (1) 1 of the same Act) or in a regional revitalization area prescribed in Article 67 of the same Act, in a place of business located in such zone or area;
4. Regional development project conducted by an implementer of a development project designated under Article 19 of the Regional Development Assistance Act in a regional development project zone under Article 11 of the same Act (limited to regional development projects falling under Article 7 (1) 1 of the same Act) or in a regional revitalization area under Article 67 of the same Act;
5. Business operated in a place of business by an enterprise commencing business or establishing a place of business (excluding where an existing place of business is relocated) by no later than December 31, 2018, within a special ocean EXPO zone designated and publicly announced under Article 15 of the Special Act on Assistance to the Expo 2012 Yeosu Korea;
6. Business operated by a project implementer designated under Article 17 of the Special Act on Assistance to the Expo 2012 Yeosu Korea for ex-post utilization of the EXPO;
7. The Saemangeum Project implemented by an enterprise constituting a project implementer under Article 8 (1) of the Special Act on Promotion and Support for Saemangeum Project, as an implementer of a project prescribed in Article 2 of the same Act.
(2) With respect to income accruing from business entitled to tax reduction or exemption of an enterprise falling under paragraph (1), an amount of tax equivalent to 100/100 of the individual local income tax in cases falling under paragraph (1) 1, 3, and 5, and an amount of tax equivalent to 50/100 of the individual local income tax in cases falling under paragraph (1) 2, 4, 6, and 7, shall be reduced or exempted for the three subsequent taxable years from the commencement date of the taxable year in which the first income accrues from the relevant business entitled to tax reduction or exemption after commencing business (when no income accrues from the relevant business by the taxable year falling on the fifth anniversary from the date the business commences, the taxable year falling on the fifth anniversary); and an amount of tax equivalent to 50/100 of the individual local income tax in cases falling under paragraph (1) 1, 3, and 5, and an amount of tax equivalent to 25/100 of the individual local income tax in cases falling under paragraph (1) 2, 4, 6, and 7, shall be reduced or exempted for the two subsequent taxable years thereafter, respectively. <Amended by Act No. 14477, Dec. 27, 2016>
(3) Where the sum of the individual local income tax reduced or exempted during the period of reduction or exemption to which paragraph (2) applies, exceeds the aggregate of the amounts prescribed in subparagraphs 1 and 2, the ceiling on the tax reduction or exemption (hereafter in this Article, referred to as "reduction or exemption ceiling"), shall be such aggregate: Provided, That where an enterprise operates a service business prescribed by Presidential Decree (hereafter in this Article, referred to as "service business"); and where the sum of the individual local income tax reduced or exempted for income accruing from the relevant service business during the period of reduction or exemption to which paragraph (2) applies, exceeds the greater of the aggregate of the amounts prescribed in subparagraphs 1 and 2, and of the amount prescribed in subparagraph 3, the amount of tax may be reduced or exempted by up to such greater amount: <Amended by Act No. 14477, Dec. 27, 2016>
1. 5/100 of the cumulative investments prescribed by Presidential Decree;
2. The lesser of the following amounts:
(a) Number of workers at ordinary times at a place of business where business falling under any subparagraph of paragraph (1) is operated in the relevant taxable year (hereafter in this Article, referred to as "place of business entitled to tax reduction or exemption") x one million won;
(b) 2/100 of the cumulative investments prescribed in subparagraph 1;
3. The lesser of the following amounts:
(a) Number of workers at ordinary times at places of business entitled to tax reduction or exemption, in the relevant taxable year x two million won;
(b) 10/100 of the cumulative investments prescribed in subparagraph 1.
(4) When applying the reduction or exemption ceiling to the individual local income tax to be reduced or exempted each taxable year pursuant to paragraph (2), an amount prescribed in paragraph (3) 1 shall be first applied and then an amount prescribed in paragraph (3) 2 shall be applied.
(5) Where the number of workers at ordinary times each taxable year at a place of business entitled to a reduction or exemption during the period from the end of the taxable year in which the tax reduction or exemption was granted, until the end of the taxable year falling on the second anniversary from the end of the taxable year in which the tax reduction or exemption was granted, has decreased as compared with the number of workers at ordinary times in the taxable year in which the tax reduction or exemption was granted, an enterprise granted a reduction or exemption of individual local income tax under paragraph (3) 2 or 3, shall pay the equivalent of the amount of tax reduced or exempted as individual local income tax, as prescribed by Presidential Decree. <Amended by Act No. 14477, Dec. 27, 2016>
(6) For the purposes of paragraphs (3) and (5), the scope of workers at ordinary times; methods for calculating the number of workers at ordinary times; and other necessary matters, shall be prescribed by Presidential Decree.
(7) For the purposes of paragraphs (1) through (6), Article 100 (6) shall apply mutatis mutandis to the scope of business startup.
(8) Any person who seeks application of paragraph (2) shall apply for tax reduction or exemption, as prescribed by Presidential Decree.
(9) An enterprise to which the reduction or exemption ceiling for service business applies pursuant to the proviso to paragraph (3), shall keep separate accounts of service business and other types of business, by applying mutatis mutandis Article 143 of the Restriction of Special Taxation Act. <Newly Inserted by Act No. 14477, Dec. 27, 2016>
(10) Where any start-up enterprise, etc. located in an enterprise city development zone, etc. the individual local income tax of which has been reduced or exempted pursuant to paragraph (2) or (3), falls under any subparagraph of Article 121-19 (1) of the Restriction of Special Taxation Act, the reduced or exempted portion of individual local income tax shall be collected as a penalty; and where it falls under Article 121-19 (1) 3 of the same Act, paragraph (2) shall not apply for the relevant taxable year and the remaining period of reduction or exemption.
[This Article Newly Inserted by Act No. 12175, Jan. 1, 2014]
 Article 157 (Reduction or Exemption, etc. of Individual Local Income Tax for Enterprises that Occupy Investment Promotion Zone for Asian Cultural Hub City)
(1) Where an enterprise that occupies an investment promotion zone designated under Article 16 of the Special Act on the Development of Asian Cultural Hub City, by no later than December 31, 2018, makes an investment, the category of business and amount invested of which meet the standards prescribed by Presidential Decree, to conduct business in such investment promotion zone, individual local income tax on such investment shall be reduced or exempted pursuant to paragraphs (2) through (6). <Amended by Act No. 14477, Dec. 27, 2016>
(2) For income accruing from business entitled to a tax reduction or exemption under paragraph (1), an amount of tax equivalent to 100/100 of the individual local income tax for the three subsequent taxable years from the commencement date of the taxable year in which the first income accrues from the relevant business entitled to a tax reduction or exemption after the date the relevant business commences (where no income accrues from the relevant business by the taxable year falling on the fifth anniversary from the date the relevant business commences, the taxable year falling on the fifth anniversary); and an amount of tax equivalent to 50/100 of the individual local income tax for the two subsequent taxable years thereafter, shall be reduced or exempted.
(3) Where the sum of the individual local income tax reduced or exempted during the period of reduction or exemption to which paragraph (2) applies, exceeds the aggregate of the amounts prescribed in subparagraphs 1 and 2, the ceiling on the tax reduction or exemption (hereafter in this Article, referred to as "reduction or exemption ceiling"), shall be such aggregate: Provided, That where an enterprise operates a service business prescribed by Presidential Decree (hereafter in this Article, referred to as "service business"); and where the sum of the individual local income tax reduced or exempted for income accruing from the relevant service business during the period of reduction or exemption to which paragraph (2) applies, exceeds the greater of the aggregate of the amounts prescribed in subparagraphs 1 and 2, and of the amount prescribed in subparagraph 3, the amount of tax may be reduced or exempted by up to such greater amount: <Amended by Act No. 14477, Dec. 27, 2016>
1. 5/100 of the cumulative investments prescribed by Presidential Decree;
2. The lesser of the following amounts:
(a) Number of workers at ordinary times at a place of business within an investment promotion zone under paragraph (1), in the relevant taxable year (hereafter in this Article, referred to as "place of business entitled to tax reduction or exemption") x one million won;
(b) 2/100 of the cumulative investments prescribed in subparagraph 1;
3. The lesser of the following amounts:
(a) Number of workers at ordinary times at places of business entitled to tax reduction or exemption, in the relevant taxable year x two million won;
(b) 10/100 of the cumulative investments prescribed in subparagraph 1.
(4) When applying the reduction or exemption ceiling to the individual local income tax to be reduced or exempted each taxable year pursuant to paragraph (2), an amount prescribed in paragraph (3) 1 shall be first applied and then an amount prescribed in paragraph (3) 2 shall be applied.
(5) Where the number of workers at ordinary times each taxable year, at a place of business entitled to a reduction or exemption during the period from the end of the taxable year in which the tax reduction or exemption was granted, until the end of the taxable year falling on the second anniversary from the end of the taxable year in which the tax reduction or exemption was granted, has decreased as compared with the number of workers at ordinary times in the taxable year in which the tax reduction or exemption was granted, an enterprise granted a reduction or exemption of individual local income tax under paragraph (3) 2 or 3, shall pay the equivalent of the amount of tax reduced or exempted as individual local income tax, as prescribed by Presidential Decree. <Amended by Act No. 14477, Dec. 27, 2016>
(6) For the purposes of paragraphs (3) and (5), the scope of workers at ordinary times; method for calculating the number of workers at ordinary times; and other necessary matters, shall be prescribed by Presidential Decree.
(7) Where no investment satisfying the standards for the reduction or exemption of individual local income tax referred to in paragraph (1), is made within two years from the end of the taxable year in which the first income accrues from the relevant business entitled to tax reduction or exemption (where no income accrues from the relevant business by the taxable year falling on the third anniversary from the date the relevant business commences, the taxable year falling on the third anniversary), the head of the competent local government shall collect as a penalty, the reduced or exempted portion of individual local income tax under paragraphs (1) through (6), as prescribed by Presidential Decree.
(8) In cases falling under paragraph (7), paragraph (2) shall not apply to the relevant taxable year and the remaining period of reduction or exemption.
(9) Any person who seeks reduction or exemption of individual local income tax under paragraph (2), shall apply therefor, as prescribed by Presidential Decree.
(10) An enterprise to which the reduction or exemption ceiling for service business applies pursuant to the proviso to paragraph (3), shall keep separate accounts of service business and other types of business, by applying mutatis mutandis Article 143 of the Restriction of Special Taxation Act. <Newly Inserted by Act No. 14477, Dec. 27, 2016>
[This Article Newly Inserted by Act No. 12175, Jan. 1, 2014]
 Article 158 (Reduction or Exemption of Individual Local Income Tax for Enterprises, etc. Incorporated in Financial Hubs)
(1) Where an enterprise is incorporated or a place of business is established (excluding where an existing place of business is relocated) in a financial hub (excluding financial hubs located in the overconcentration control district of the Seoul Metropolitan area) designated under Article 5 (5) of the Act on the Creation and Development of Financial Hubs by no later than December 31, 2018, and operates finance business or insurance business meeting the requirements prescribed by Presidential Decree (hereafter in this Article, referred to as "business entitled to tax reduction or exemption") in a place of business located in such zone (hereafter in this Article, referred to as "place of business entitled to tax reduction or exemption"), individual local income tax shall be reduced or exempted pursuant to paragraphs (2) through (6). <Amended by Act No. 14477, Dec. 27, 2016>
(2) For income accruing from business entitled to a reduction or exemption in a place of business located in the zone of financial hub under paragraph (1), an amount of tax equivalent to 100/100 of the individual local income tax for the three subsequent taxable years from the commencement date of the taxable year in which the first income accrues from the relevant business entitled to tax reduction or exemption after the date the relevant business commences (where no income accrues from the relevant business by the taxable year falling on the fifth anniversary from the date the relevant business commences, the taxable year falling on the fifth anniversary); and an amount of tax equivalent to 50/100 of the individual local income tax for the two subsequent taxable years thereafter, shall be reduced or exempted.
(3) Where the sum of the individual local income tax reduced or exempted during the period of reduction or exemption to which paragraph (2) applies, exceeds the aggregate of the following amounts, the ceiling on the tax reduction or exemption (hereafter in this Article, referred to as "reduction or exemption ceiling"), shall be such aggregate: Provided, That where an enterprise operates a service business prescribed by Presidential Decree (hereafter in this Article, referred to as "service business"); and where the sum of the individual local income tax reduced or exempted for income accruing from the relevant service business during the period of reduction or exemption to which paragraph (2) applies, exceeds the greater of the aggregate of the amounts prescribed in subparagraphs 1 and 2, and of the amount prescribed in subparagraph 3, the amount of tax may be reduced or exempted by up to such greater amount: <Amended by Act No. 14477, Dec. 27, 2016>
1. 5/100 of the cumulative investments prescribed by Presidential Decree;
2. The lesser of the following amounts:
(a) Number of workers at ordinary times at a place of business entitled to reduction or exemption, in the relevant taxable year x one million won;
(b) 2/100 of the cumulative investments prescribed in subparagraph 1;
3. The lesser of the following amounts:
(a) Number of workers at ordinary times at places of business entitled to tax reduction or exemption, in the relevant taxable year x two million won;
(b) 10/100 of the cumulative investments prescribed in subparagraph 1.
(4) When applying the reduction or exemption ceiling to the individual local income tax to be reduced or exempted each taxable year pursuant to paragraph (2), the amount prescribed in paragraph (3) 1 shall be applied first and then the amount prescribed in paragraph (3) 2 shall be applied.
(5) Where the number of workers at ordinary times each taxable year, at a place of business entitled to a reduction or exemption of individual local income tax during the period from the end of the taxable year in which the tax reduction or exemption was granted, until the end of the taxable year falling on the second anniversary from the end of the taxable year in which the tax reduction or exemption was granted, has decreased as compared with the number of workers at ordinary times in the taxable year in which the tax reduction or exemption was granted, an enterprise granted a reduction or exemption of individual local income tax under paragraph (3) 2 or 3, shall pay the equivalent of the amount of tax reduced or exempted as individual local income tax, as prescribed by Presidential Decree. <Amended by Act No. 14477, Dec. 27, 2016>
(6) For the purposes of paragraphs (3) and (5), the scope of workers at ordinary times; method for calculating the number of workers at ordinary times; and other necessary matters, shall be prescribed by Presidential Decree.
(7) Where no investment satisfying the standards for tax reduction or exemption referred to in paragraph (1), is made within two years from the end of the taxable year in which the first income accrues from the relevant business entitled to tax reduction or exemption (where no income accrues from the relevant business by the taxable year falling on the third anniversary from the date the relevant business commences, the taxable year falling on the third anniversary), the head of the competent local government shall collect as a penalty, the reduced or exempted portion of individual local income tax under paragraphs (1) through (6), as prescribed by Presidential Decree.
(8) In cases falling under paragraph (7), paragraph (2) shall not apply to the relevant taxable year and the remaining period of reduction or exemption.
(9) Any person who seeks reduction or exemption of individual local income tax under paragraph (2), shall apply therefor, as prescribed by Presidential Decree.
(10) An enterprise to which the reduction or exemption ceiling for service business applies pursuant to the proviso to paragraph (3), shall keep separate accounts of service business and other types of business, by applying mutatis mutandis Article 143 of the Restriction of Special Taxation Act. <Newly Inserted by Act No. 14477, Dec. 27, 2016>
[This Article Newly Inserted by Act No. 12175, Jan. 1, 2014]
 Article 159 (Reduction or Exemption of Individual Local Income Tax for Enterprises, etc. that Occupy High-Tech Medical Complexes)
(1) Where an enterprise that occupies a high-tech medical complex designated under Article 6 of the Special Act on the Designation and Support of High-Tech Medical Complexes by no later than December 31, 2019, conducts business prescribed by Presidential Decree, such as health and medical technology business (hereafter in this Article, referred to as "business entitled to reduction or exemption"), at a place of business located at such high-tech medical complex (hereafter in this Article, referred to as "place of business entitled to reduction or exemption"), the individual local income tax shall be reduced or exempted pursuant to paragraphs (2) through (6). <Amended by Act No. 14477, Dec. 27, 2016>
(2) For income accruing from business entitled to reduction or exemption operated at a place of business entitled to reduction or exemption referred to in paragraph (1), an amount of tax equivalent to 100/100 of the individual local income tax for the three subsequent taxable years from the commencement date of the taxable year in which the first income accrues from the relevant business entitled to tax reduction or exemption after the date the relevant business commences (where no income accrues from the relevant business until the taxable year falling on the fifth anniversary from the date the relevant business commences, the taxable year falling on the fifth anniversary); and an amount of tax equivalent to 50/100 of the individual local income tax for the two subsequent taxable years thereafter, shall be reduced or exempted.
(3) Where the sum of the individual local income tax reduced or exempted during the period of reduction or exemption to which paragraph (2) applies, exceeds the aggregate of the amounts prescribed in subparagraphs 1 and 2, the ceiling on the tax reduction or exemption (hereafter in this Article, referred to as "reduction or exemption ceiling"), shall be such aggregate: Provided, That where an enterprise operates a service business prescribed by Presidential Decree (hereafter in this Article, referred to as "service business"); and where the sum of the individual local income tax reduced or exempted for income accruing from the relevant service business during the period of reduction or exemption to which paragraph (2) applies, exceeds the greater of the aggregate of the amounts prescribed in subparagraphs 1 and 2, and of the amount prescribed in subparagraph 3, the amount of tax may be reduced or exempted by up to such greater amount: <Amended by Act No. 14477, Dec. 27, 2016>
1. 5/100 of the cumulative investments prescribed by Presidential Decree;
2. The lesser of the following amounts:
(a) Number of workers at ordinary times at a place of business entitled to reduction or exemption, in the relevant taxable year x one million won;
(b) 2/100 of the cumulative investments prescribed in subparagraph 1;
3. The lesser of the following amounts:
(a) Number of workers at ordinary times at places of business entitled to tax reduction or exemption, in the relevant taxable year x two million won;
(b) 10/100 of the cumulative investments prescribed in subparagraph 1.
(4) When applying the reduction or exemption ceiling to the individual local income tax to be reduced or exempted each taxable year pursuant to paragraph (2), an amount prescribed in paragraph (3) 1 shall be first applied and then an amount prescribed in paragraph (3) 2 shall be applied.
(5) Where the number of workers at ordinary times each taxable year, at a place of business entitled to a reduction or exemption during the period from the end of the taxable year in which the tax reduction or exemption was granted, until the end of the taxable year falling on the third anniversary from the end of the taxable year in which the tax reduction or exemption was granted, has decreased as compared with the number of workers at ordinary times in the taxable year in which the tax reduction or exemption was granted, an enterprise granted a reduction or exemption of individual local income tax under paragraph (3) 2 or 3, shall pay the equivalent of the amount of tax reduced or exempted as individual local income tax, as prescribed by Presidential Decree. <Amended by Act No. 14477, Dec. 27, 2016>
(6) For the purposes of paragraphs (3) and (5), the scope of workers at ordinary times; method for calculating the number of workers at ordinary times; and other necessary matters, shall be prescribed by Presidential Decree.
(7) Any person who seeks reduction or exemption of individual local income tax under paragraph (2), shall apply therefor, as prescribed by Presidential Decree.
(8) An enterprise to which the reduction or exemption ceiling for service business applies pursuant to the proviso to paragraph (3), shall keep separate accounts of service business and other types of business, by applying mutatis mutandis Article 143 of the Restriction of Special Taxation Act. <Newly Inserted by Act No. 14477, Dec. 27, 2016>
[This Article Newly Inserted by Act No. 12175, Jan. 1, 2014]
 Article 160 (Tax Credits for Increased Revenue, etc. of Gold Trading Business Operators and Business Operators of Copper Scrap, etc.)
(1) Where the gross income and deductible expenses settled for or by a gold trading business operator (limited to a business operator who intends to supply or to be supplied with, or intends to import the products prescribed in Article 106-4 (1) 3 of the Restriction of Special Taxation Act) or business operator of copper scrap, etc. respectively under Article 106-4 or 106-9 of the Restriction of Special Taxation Act through a gold trading account or account for trading copper scrap, etc. referred to in Article 106-4 or 106-9 of the same Act (hereafter in this paragraph, referred to as "gross income and deductible expenses paid by a purchaser"), are included in the gross income and deductible expenses returned by business place at the time of filing a tax return (hereafter in this paragraph, referred to as "gross income and deductible expenses"), the operator may obtain a tax credit for any of the following amounts from that of individual local income tax for the relevant taxable year until the taxable year ending as at December 31, 2018. In such cases, no tax credit shall exceed the amount calculated by deducting the amount of individual local income tax calculated on global income for the immediately preceding taxable year from the amount of individual local income tax calculated on global income for the relevant taxable year: <Amended by Act No. 14477, Dec. 27, 2016>
1. If the aggregate of gross income and deductible expenses paid by the purchaser returned by business place when he/she files a tax return, exceeds the aggregate of gross income and deductible expenses paid by the purchaser for the immediately preceding taxable year: An amount calculated by multiplying the ratio occupied by the equivalent of 50/100 of such excess (which shall not exceed the total of the increased amount of gross income and deductible expenses by business place) in the total amount of gross income and deductible expenses, by the rate of individual local income tax on global income. In such cases, where the purchaser has not paid any amount of gross income and deductible expenses in the immediately preceding taxable year, the aggregate of gross income and deductible expenses for the immediately preceding taxable year, shall be deemed the aggregate of gross income and deductible expenses paid by the purchaser for the immediately preceding taxable year;
2. An amount calculated by multiplying the ratio occupied by the equivalent of 5/100 of the aggregate of gross income and deductible expenses paid by the purchaser returned by business place when filing a tax return in the aggregate of gross income and deductible expenses, by the amount of individual local income tax calculated on global income.
(2) For the purposes of paragraph (1), matters necessary for calculating the amount of the tax credit, and other necessary matters, shall be prescribed by Presidential Decree.
(3) Any person who seeks application of paragraph (1) shall apply for a tax credit, as prescribed by Presidential Decree.
[This Article Newly Inserted by Act No. 12175, Jan. 1, 2014]
 Article 161 (Tax Credit for Cash Receipt Merchants)
(1) A business operator who has cash receipt-issuing machines connected with credit card terminals, etc. (hereafter in this Article, referred to as "cash receipt merchant") who issues cash receipts under paragraph (2) (limited to cash receipts for less than 5,000 won for each transaction, and referring to cash receipts approved for issuance through the telephone network), shall be entitled to the tax credit equivalent to the amount calculated by multiplying the number of cash receipts issued during the pertinent taxable period by the amount prescribed by Presidential Decree (hereafter in this Article, referred to as "tax credit amount") for the individual local income tax calculated for the pertinent taxable period. In such cases, no tax credit amount shall exceed the amount of tax calculated.
(2) "Cash receipt" in paragraph (1) means receipts which, in cases of cash settlement, a cash receipt merchant issues the person supplied with goods or service by means of cash receipt-issuing machines in exchange for the supply of such goods or service, stating the details of the settlement, such as the date, time, and amount of the trading.
(3) The methods and procedures for granting a tax credit, etc. under paragraph (1) shall be prescribed by Presidential Decree.
[This Article Newly Inserted by Act No. 12175, Jan. 1, 2014]
 Article 162 (Tax Credit for Gold Bullion Traded in Spot Gold Market)
(1) Where a business operator prescribed by Presidential Decree who supplies gold bullion prescribed by Presidential Decree (hereafter in this Article, referred to as "gold bullion") (hereafter in this Article, referred to as "entrepreneur who supplies gold bullion"), supplies the gold bullion deposited at a safekeeping agency prescribed by Presidential Decree through a spot gold market prescribed by Presidential Decree (hereafter in this Article, referred to as "spot gold market") by not later than December 31, 2015, or where an entrepreneur who has purchased gold bullion in the spot gold market (hereafter in this paragraph, referred to as "entrepreneur who purchases gold bullion"), withdraws the relevant gold bullion from the safekeeping agency by not later than December 31, 2015, regarding the relevant value of supply or amount of purchase (hereafter in this paragraph, referred to as "amount used in the spot gold market": Provided, That if the entrepreneur who supplies gold bullion and the entrepreneur who purchases gold bullion are in special relationship prescribed by Presidential Decree, the relevant amount shall be excluded), an amount selected from any of the following subparagraphs, shall be deducted from individual local income tax (applicable only to individual local income tax on business income; hereafter in this paragraph, the same shall apply) for the taxable year in which the date of supply or purchase (referring to the date goods are supplied under Article 15 of the Value-Added Tax Act), falls: Provided, That if the amount used in the spot gold market during the immediately preceding taxable year is less than the amount used during the year before the immediately preceding taxable year, an amount calculated by applying subparagraph 2, shall be deducted from individual local income tax of the relevant taxable year: <Amended by Act No. 12506, Mar. 24, 2014>
1. Where the amount used in the spot gold market exceeds the amount used in the spot gold market during the immediately preceding taxable year, an amount calculated by multiplying the amount of individual local income tax calculated on global income, by the ratio of such excess (hereafter in this subparagraph, referred to as "excess of the amount used") to the sales amount of the relevant taxable year: Provided, That where the spot gold market is first utilized while no amount is used in the spot gold market during the immediately preceding taxable year, the amount used in the spot gold market during the relevant taxable year shall be deemed the excess of the amount used;
2. An amount calculated by multiplying the amount of individual local income tax calculated on global income, by the ratio of the equivalent of 5/100 of the amount used in the spot gold market during the relevant taxable year to the sales amount of the relevant taxable year.
(2) For the purposes of paragraph (1), matters necessary for calculating, etc. the amount of a tax credit, and for applying for a tax credit, shall be prescribed by Presidential Decree.
[This Article Newly Inserted by Act No. 12175, Jan. 1, 2014]
 Article 163 (Reduction or Exemption of Individual Local Income Tax on Capital Gains)
Where any amount of income entitled to reduction or exemption under this Act exists in the amount of capital gains prescribed in Article 95 of the Income Tax Act, the amount calculated by applying mutatis mutandis the calculation method prescribed in Article 90 (1) of the Income Tax Act, shall be reduced or exempted. In such cases, the tax rate to be applied to capital gains tax base shall be the tax rate prescribed in Article 103-3 of the Local Tax Act.
[This Article Wholly Amended by Act No. 12955, Dec. 31, 2014]
 Article 164 (Tax Credit for Political Funds)
With respect to political funds donated by a resident to a political party (including its supporters' association under the Political Funds Act and the election commissions) under the same Act, the equivalent of 10/100 of the tax credit amount prescribed in Article 76 (1) of the Restriction of Special Taxation Act, shall be deducted from the amount of individual local income tax calculated for the relevant taxable year in which they have been disbursed. <Amended by Act No. 12506, Mar. 24, 2014>
[This Article Newly Inserted by Act No. 12175, Jan. 1, 2014]
 Article 165 (Tax Credits for Electronic Commerce of Petroleum Products)
(1) Where any person prescribed by Presidential Decree, such as a petroleum refiner defined in subparagraph 7 of Article 2 of the Petroleum and Alternative Fuel Business Act, supplies or is supplied with petroleum products defined in subparagraph 2 of Article 2 of the Petroleum and Alternative Fuel Business Act, by no later than December 31, 2019, through an electronic payment network prescribed by Presidential Decree, an amount classified as follows shall be deducted from individual local income tax (limited to individual local income tax on business income) in the taxable year in which the date of supply or the date of receiving petroleum products (referring to the date goods are supplied under Article 15 of the Value-Added Tax Act), falls: Provided, That where the deduction exceeds 10/100 of the individual local income tax for the relevant taxable year, such excess shall be deemed nonexistent: <Amended by Act No. 14477, Dec. 27, 2016>
1. A person who supplies petroleum products: The equivalent of 1/10,000 of the supply price (referring to the supply price under Article 29 of the Value-Added Tax Act; hereafter in this paragraph, the same shall apply);
2. A person who is supplied with petroleum products: The equivalent of 2/10,000 of the supply price.
(2) A national who seeks application of paragraph (1) shall apply for a tax credit, as prescribed by Presidential Decree.
[This Article Newly Inserted by Act No. 12175, Jan. 1, 2014]
 Article 166 (Tax Credit for Expenses Incurred in Verifying Faithful Reporting)
(1) For a business operator entitled to a tax credit for expenses incurred in verifying faithful reporting under Article 126-6 of the Restriction of Special Taxation Act, the equivalent of 10/100 of the tax credit amount prescribed in paragraph (1) of the same Act, shall be deducted from individual local income tax for the relevant taxable year; and where an amount deducted under paragraph (2) of the same Act is collected as a penalty, an amount of tax equivalent to the amount deducted from individual local income tax, shall also be collected as a penalty.
(2) Any person who seeks application of paragraph (1) shall apply for a tax credit, as prescribed by Presidential Decree.
[This Article Newly Inserted by Act No. 12175, Jan. 1, 2014]
 Article 167 (Special Taxation of Corporate Local Income Tax on Association Corporation, etc.)
Notwithstanding the standard tax rate of corporate local income tax prescribed in Article 103-20 of the Local Tax Act, the rate of corporate local income tax for a corporation subject to Article 72 (1) of the Restriction of Special Taxation Act, shall be a rate equivalent to 10/100 of the corporate tax rate prescribed in Article 72 (1) of the Restriction of Special Taxation Act, until the business year ending as at December 31, 2020. <Amended by Act No. 12955, Dec. 31, 2014; Act No. 13637, Dec. 29, 2015; Act No. 15295, Dec. 26, 2017>
[This Article Newly Inserted by Act No. 12175, Jan. 1, 2014]
 Article 167-2 (Tax Credit, or Reduction of or Exemption from Individual Local Income Tax)
(1) Where income tax is deducted, reduced, or exempted under the Income Tax or the Restriction of Special Taxation Act (including tax credits carried forward under Article 144 of the Restriction of Special Taxation Act), individual local income tax equivalent to 10/100 of the deducted, reduced, or exempted amount (where any of Articles 127 through 129, 132, and 133 of the Restriction of Special Taxation Act applies, referring to the amount resulting after applying such provisions) shall be deducted, reduced, or exempted, notwithstanding the provisions of tax credit, reduction, and exemption of individual local income tax prescribed in this Chapter and Article 180 of this Act. <Amended by Act No. 13637, Dec. 29, 2015>
(2) Where income tax is paid on grounds for collecting as a penalty, the deducted, reduced, or exempted portion of income tax under the Income Tax Act or the Restriction of Special Taxation Act, the deducted, reduced, or exempted portion of individual local income tax pursuant to paragraph (1), shall also be paid. In such cases, where the equivalent of interest is added under the Income Tax Act or the Restriction of Special Taxation Act to the income tax payable, the equivalent of 10/100 of the added amount shall be added to the individual local income tax.
[This Article Newly Inserted by Act No. 12955, Dec. 31, 2014]
<<Paragraph (1) of this Article shall apply until Dec. 31, 2019 under Article 2 of the Addenda to Act No. 12955, Dec. 31, 2014>>
SECTION 12 Restriction, etc. on Special Provisions on Taxation of Local Income Tax
 Article 168 (Elimination of Duplicative Support)
(1) Where any of Articles 99, 103, 109 through 114, 137, and 151 (2), applies to the assets invested by a national prescribed in this Act, the following amounts shall be deducted from the amount so invested or acquired:
1. Where a national receives contributions or other assets from the State, local governments, public institutions prescribed in the Act on the Management of Public Institutions, or local public enterprises prescribed in the Local Public Enterprises Act (hereafter in this Article, referred to as the "State, etc.") for investing in assets, and invests them: The equivalent of the amount of contribution, etc. invested:
(a) The State;
(b) Local governments;
(c) Public institutions prescribed in the Act on the Management of Public Institutions;
(d) Local public enterprises prescribed in the Local Public Enterprises Act;
2. Where a national obtains a loan from a finance company, etc. falling under any item of subparagraph 1 of Article 2 of the Act on Real Name Financial Transactions and Confidentiality (hereafter in this Article, referred to as "finance company, etc.") for investing in assets, and invests the loan, and the State, etc. fully or partially pays the interest payable to the finance company, etc. on behalf of the national: The equivalent of the cost of interest paid by the State, etc., calculated as prescribed by Presidential Decree;
3. Where a national obtains a loan from the State, etc. for investing in assets, and invests it: The equivalent of the amount of subsidy for interest granted by the State, etc., calculated as prescribed by Presidential Decree.
(2) Where Articles 99, 103, 109 through 114, 137, and 151 (2) concurrently apply to the assets invested by a national prescribed in this Act, and Articles 114 and 118 concurrently apply in the same taxable year, he/she may select only one of them as applicable.
(3) For the purposes of Article 99, 103, 109 through 114, 118, 137, 150, or 151 (2) where individual local income tax is reduced or exempted pursuant to Article 153 for any national in the same taxable year, the equivalent of 10/100 of the amount calculated by multiplying the deductible tax under the relevant provisions by the rate of the stocks or stakes owned by a national investor, among the total issued stocks or stakes of the relevant enterprise, shall be deducted.
(4) Where a national is eligible in the same taxable year, both for the reduction or exemption of local income tax prescribed in Articles 100, 101, 105, 122, 124 through 128, 135 (1) and (2), 152 (1), and 154 through 159 and for the deduction of local income tax under Articles 99, 103, 109 through 114, 118, 137, 150, 151, 160, 162, and 165, he/she may select only one such provision as applicable. <Amended by Act No. 12955, Dec. 31, 2014>
(5) Where at least two of the provisions regarding reduction or exemption of local income tax prescribed in Articles 100, 101, 105, 122, 124, 125, 135 (1) and (2), and 152 through 159, apply to the same business place of a national in the same taxable year, he/she may select only one such provision as applicable.
(6) Where at least two provisions for reducing or exempting individual local income tax on capital gains, concurrently apply to a resident's transfer of land, etc., only one provision for reduction or exemption selected by the resident shall apply: Provided, That where part of land, etc. is subject to the application of specific provisions for reduction or exemption, the remaining parts of such land, etc. may be subject to other provisions for reduction or exemption.
(7) A resident who transfers a house to a third person and consequently becomes subject to Articles 142 and 143 of this Act simultaneously, may select one of them as applicable.
(8) For the purposes of paragraphs (3) and (4), if separate accounting is kept between the business entitled to reduction or exemption under Article 143 of the Restriction of Special Taxation Act and any other business, and the provisions on deduction is applied to such other business, the relevant tax reduction or exemption shall not be entitled to duplicative support.
[This Article Newly Inserted by Act No. 12175, Jan. 1, 2014]
 Article 169 (Exclusion from Reduction or Exemption in Cases of Estimated Taxation, etc.)
(1) Articles 99, 102, 103, 104 (2), 109 through 115, 117, 118, 137, 150, 151, 160, 162, and 165 shall not apply where an amount of tax is estimated pursuant to the proviso to Article 80 (3) of the Income Tax Act: Provided, That even when an amount of tax is estimated, Articles 99 and 114 of this Act (limited to where evidentiary documents for investments are submitted), shall apply only to residents. <Amended by Act No. 12955, Dec. 31, 2014>
(2) No tax reduction or exemption prescribed in Articles 100, 101, 104 (1), 105, 122, 124 through 128, 135 (1) and (2), 138, 149, 152 (1), and 154 through 159, shall apply, where a decision is made pursuant to Article 97 of the Local Tax Act; or where a return is filed after the given period pursuant to Article 51 of the Framework Act on Local Taxes. <Amended by Act No. 14474, Dec. 27, 2016>
(3) Articles 100, 101, 104 (1), 105, 122, 124 through 128, 135 (1) and (2), 138, 149, 152 (1), and 154 through 159 shall not apply to any under-reported amount prescribed by Presidential Decree, where correction (excluding correction due to any cause falling under any subparagraph of paragraph (4)) is made pursuant to Article 97 of the Local Tax Act; and where an amended tax return is filed foreknowing that the tax base and amount of tax filed will be corrected.