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Industry

Solar cell domestic production tax credit pushed; Hanwha Solutions says no effect without direct pay

South Korea\'s solar industry is urging the government to add direct pay to a planned domestic production tax credit, saying loss-making companies cannot benefit without a refund mechanism. Hanwha Solutions said the domestic solar cell manufacturing base is disappearing, with local cell market share falling sharply since 2021. The government plan caps credits and does not include direct pay or transferability. The company said direct pay is needed due to high upfront and operating costs at cell plants.

Industry

Semiconductor, battery direct refund scheme in focus ahead of July tax reform plan

A proposed direct refund scheme that would pay out semiconductor and battery investment tax credits in cash has emerged as a key issue ahead of the government’s late-July tax reform plan. South Korea largely relies on corporate tax credits that only apply when companies owe tax, limiting benefits for firms in early loss-making years. Industry groups say this can delay investment and call for U.S.-style refunds. Fiscal authorities are reviewing possible revenue losses.