[Suwan News = Reporter Kim Dong-ju] The Korean Council for University Education (Chairman Yang Oh-bong, President of Jeonbuk National University; hereinafter “the Council”) has proposed measures to improve the tax system for universities and related policies to the Ministry of Education, the Ministry of Economy and Finance, and the Ministry of the Interior and Safety, with the aim of diversifying university funding sources and enhancing the sustainability of higher education.
The Korean Council for University Education, chaired by Secretary-General Lee Kyung-hee, held a series of policy roundtables to address pressing tax issues facing universities from July 17 to September 5 of last month, October 1, to address pending tax issues facing universities. The meetings covered topics such as a 100,000 won tax deduction for university donations, local tax exemptions for corporate rental spaces on university campuses in industry-academia collaboration projects, the expansion of tax exemptions for the replacement acquisition of income-generating basic assets, and a reduction in the usage rate for private universities utilizing state-owned property for educational purposes.
The main points of the policy recommendations aimed at resolving pending issues, such as improvements to the university tax system, are as follows.
Introduction of a 100,000 won tax deduction for university donations
Local Tax Exemptions for Corporate Rental Space on University Campuses in Industry-Academia Collaboration Initiatives
We proposed introducing a full tax deduction of up to 100,000 won for small donations to universities—similar to the “Love for My Hometown” donation program—to encourage small individual donations to universities, and
Since the acquisition tax and property tax burdens associated with rental space—which universities use for industry-academia collaboration and joint research under initiatives such as the RISE program, or to attract partner companies—are hindering efforts to revitalize industry-academia collaboration, including the recruitment of external companies, a proposal was made to apply special local tax exemptions to these expenses.
Expansion of Special Tax Provisions for the Replacement Acquisition of Basic Income-Generating Assets
Reduction in the Rate for the Use of State-Owned Property by Private Universities for Educational Purposes
Furthermore, while the acquisition of substitute assets for a school foundation’s income-generating basic assets is encouraged to improve the efficiency of financial management, the short deadline for such acquisitions and the tax deferral mechanism result in difficulties in asset management due to the corporate income tax burden on capital gains, and,
While national and public universities are subject to a usage fee rate of 25 per thousand when using state-owned land, private universities are charged rates ranging from 25 to 50 per thousand depending on the levying authority, raising issues of fairness. Therefore, it was recommended that private universities also be subject to the same state-owned property usage rate as national andpublic universities be applied to private universities as well.
Ongoing Consultations Planned Between the Korean Council for University Education and Relevant Government Ministries to Improve Higher Education Policy and Enhance Competitiveness
Meanwhile, the Korean Council for University Education announced that, taking this proposal as an opportunity, it plans to broaden public discussion on policy improvements—such as tax reforms for universities—and to continue consulting with relevant government agencies to ensure that institutional reforms are implemented to strengthen the competitiveness of higher education.
Kim Dong-ju, Reporter
