On August 8, 2013, the Ministry of Strategy and Finance (MOSF) announced South Korea’s tax reform package for 2013. The MOSF proposals include two changes with respect to the application of a flat tax rate on employment income of foreigners working in Korea. These changes could potentially eliminate the favorable benefits of the flat tax rate if an assignee falls within their parameters.
The proposed reforms infer in what direction tax policies may proceed over the next five years and thus taxpayers should consider how they may affect their business. The reforms aim to support the government’s fiscal tasks, promote fairness in taxation, and expand the sources of tax revenue.