Song Byeong-jun, chair of the Venture Business Association, asked the government to introduce tax support for restricted stock units (RSUs) and extend special tax measures related to mergers and acquisitions (M&A) of venture companies, among other regulatory improvements to boost the growth of venture companies and activate investment.
Song attended the "Economic associations and groups regulatory rationalization roundtable" at the Korea Chamber of Commerce and Industry on the 28th and delivered these on-site regulatory improvement tasks.
At the roundtable, the prime minister, representatives of major business groups including the Korea Chamber of Commerce and Industry, the Korea Enterprises Federation, The Federation of Korean Industries, the Korea International Trade Association, the Federation of Middle Market Enterprises of Korea (FOMEK), and the Korea Federation of Small and Medium Enterprises, as well as members of the Regulatory Rationalization Committee and officials from relevant ministries, discussed economic issues and ways to improve regulations.
Song expressed gratitude that the government recognizes ventures and startups as a new growth engine and is expanding support policies. While welcoming the recent inclusion of expanded tax support for venture investment in the tax reform plan, he stressed that a systemic foundation to secure top talent is necessary for the continued growth of venture companies.
In particular, he called for introducing tax support for RSUs. "For venture companies, talent is competitiveness," Song said, noting the need to fix the current system that imposes taxes from the vesting date on RSUs that have not been cashed out. He said various tax support measures—such as tax deferral, installment payment, and tax exemption—should be prepared for RSUs as well, in light of parity with stock options.
He also proposed extending or supplementing special tax measures related to venture M&A and reinvestment. The point is that the related special measures, set to expire under the sunset clause in this tax reform plan, are needed to ensure a virtuous cycle in the venture ecosystem.
"Funds from successful venture companies should flow back into the venture ecosystem, and M&A and strategic alliances among venture companies should be activated," Song said. "Please extend the tax deferral system so it does not end uniformly, or prepare reasonable supplementary measures."
He also proposed making the work-hour system more flexible for research and development (R&D) personnel at venture companies and improving the telemedicine system. Given the nature of R&D work, he asked to expand the unit for managing overtime from the current weekly basis to monthly, quarterly, and semiannual units, and to consider introducing a Korea-style "white-collar exemption" for key research personnel.
He also proposed improving the telemedicine system. Song emphasized that the subordinate regulations should be designed reasonably so the telemedicine system taking effect in Dec. can be established as a system that enhances public convenience. He asked to ensure continuity of care by using existing consultation and prescription histories and, with necessary safeguards, to allow broader at-home receipt of medications.