South Korea import VAT deferment

South Korea is to become the latest country to offer an import VAT deferment scheme to help mitigate cash flow management for importers. The proposal would enable the importer of record to delay payment of both import VAT and duties until the next VAT return.

To qualify for the new scheme, which launches in July 2016 a number of conditions must apply:

• Importers should be in the manufacturing and productions sectors, and the goods being imported must contribute directly to their business
• They should have been active importers for at least three years
• Importers must be small or medium sized businesses
• Importing must make-up 30% or more of the business’taxable supplies