09/02/22

SOUTH KOREA: Industry Minister asks OECD chief for more discussions on digital tax deal.

As published on koreatimes.co.kr, Wednesday 9 February, 2022.

Korea has asked the chief of the Organization for Economic Cooperation and Development (OECD), Wednesday, to have additional discussions on its global tax deal to prevent exporters from shouldering an excessive burden, according to the industry ministry.

Industry Minister Moon Sung-wook made the request during a meeting with the organization's Secretary-General Mathias Cormann held in Seoul.

In October, the OECD announced that 136 nations had agreed upon a sweeping reform of the international tax system to adopt a 15 percent global minimum corporate tax starting in 2023 to ensure that major multinational companies pay a fair share of taxes wherever they operate and generate profits.

During the meeting, Moon stressed the need for the nations involved to have more discussions on remaining technical issues of contention amid concerns over the deal's impact on the country's major exporters.

Factoring in the rules of the tax deal, Samsung Electronics is expected to be subject to the scheme. Under the deal, companies with more than 20 billion euros of revenue are required to pay taxes in countries where the revenue has been earned. The bar will be lowered to 10 billion euros in 2030.

The OECD chief said that related discussions will continue in order to make the deal take effect next year as planned, while asking for Korea's active cooperation, according to the ministry.

The two sides also exchanged opinions on major global economic issues such as supply chains and climate change, and sought ways of cooperation.

"Secretary-General Cormann said Korea has been a good model for many OECD nations in its responses to the COVID-19 pandemic and an economic recovery," the ministry said in a release. "He voiced expectations for Seoul's active role and contribution over the course of policy coordination on those issues among the member nations." (Yonhap)