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Individual Consumption Tax in S.Korea

[Individual Consumption Tax]

 

 

 

Outline

Individual consumption tax in S. Korea refers to a consumption tax selectively levied on specific goods and services, which is formerly called special consumption tax. It's an indirect tax which is designed to suppress the waste of high-income level and the trend of luxury living, and to make people live a balanced and sound consumer life.

 

Any person who intends to import items subject to individual consumption tax, he/she shall pay individual consumption tax along with customs duty to the competent Customs.

 

 

Taxable Object

 

General products

- Electric and recreational meandering equipment and other amusement goods

- Hunting guns (except air guns)

 

Standard price setting article

- Jewelery, pearls, turtles, coral, pumpkin, ivory and products using them

- Precious metal products

- Luxury Watch

- Advanced fur and its products

- Luxury bags

- Luxury carpets

- Luxury furniture

 

Automobile

- Passenger cars, camper cars with displacement exceeding 2000cc

- passenger cars with a displacement of 2000cc or less,

- Electric car

 

Oil

- Gasoline, light oil, kerosene, heavy oil, propane, butane, natural gas, byproduct oil, bituminous coal

 

Tobacco

 

 

Assessment Standard and Tax Amount

Individual consumption tax is the amount of multiplying assessment standard of import goods by relevant individual consumption tax rate.

 

Assessment standard

 

General goods : dutiable value of customs duty + customs duty

Goods whose base price is set : (dutiable value of customs duty + customs duty ) base price

Goods whose customs duty is levied by quantity : quantity (kg, , etc.)

 

 

Exemption Targets From Individual Consumption Tax

 

In S. Korea, individual consumption tax may be exempt according to the importer, usage, etc. speculated by the Individual Consumption Tax Act.

 

Exemption Targets

 

Goods to which simplified tax rate is applied in accordance with the Customs Act;

Goods collected in manufactory in accordance with the Livestock Products Sanitary Control Act, the Pharmaceutical Affairs Act or the Food Sanitation Act;

Carrying-out of the goods which are to be exported to other place;

Import goods on the condition of being exhibited in international fair, or import goods for free for the exhibition of domestic fair, etc. which are duty-exempt;

Goods which are carried in duty-exempt, but returned to manufactory for the reasons of poor quality or other particulars;

Goods to be exported;

Goods to be supplied to foreign military forces stationed in S. Korea;

Diplomatic goods;

Goods exclusively supplied for dealership for foreigners;

Goods applicable to the conditions regulated by this Act such as goods for raw materials, research, academic studies, donation, and moving purposes;

Other items speculated by this Act.

 

 

References

 

Individual consumption tax is applied to taxable objects and at a tax rate speculated by the Individual Consumption Tax Act. Please check whether relevant goods may be tax-exempt according to the importer, usage, etc.

 

Among goods on whose individual consumption tax is levied, there are goods on whose education tax and rural development tax are levied at the same time.

 


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