Firms in regions hit by restructuring to be allowed tax payment reprieve

SEJONG, June 19 (Yonhap) -- Companies based in restructuring-hit cities and regions will be eligible to win reprieve from tax payment for up to two years under a set of measures meant to help them recover their business operations, the finance ministry said Tuesday.

Under the revision to tax-related endorsement approved by the Cabinet, they will be given a grace period of up to two years for tax payments, from the current one-year grace period, the ministry said.

In May, the government designated Ulsan, Geoje, Mokpo and several other regions, home to the country's shipbuilders and related industries, as an emergency response zone to provide job support and tax incentives as these areas are reeling from high unemployment.

The designation came as local shipbuilders have suffered a drawn-out slump, which forced them to implement massive restructuring efforts, including extensive job cuts.

Thousands of workers in the country's shipbuilding and automaking sectors have lost their jobs or may be dismissed as the industries are struggling with a protracted slump.

Gunsan, the home to General Motors' money-losing assembly line, was designated as an emergency response zone in April this year after the American automaker in February announced a plan to shut down its underutilized plant in the city, 274 kilometers south of Seoul.

Under the measure, those who lost their jobs will be eligible for government subsidies and job training, and companies that start new businesses in the city are eligible for tax exemptions for up to five years, as well as other incentives.

sam@yna.co.kr
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