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VAT Rates in South Korea

Quick overview

Standard Rate Reduced Rate Other Rates
10% N/A 0%, Exempt

The local name for VAT in South Korea is Boo-ga-ga-chi-se (also known as Boo-ga-se).

There is basically 1 VAT rates in South Korea, a Standard VAT rate of 10%

Recent developments

For more information about (recent) rate change developments in South Korea, please click HERE.

Standard rate: 10%

This rate applies for all transactions that take place in South Korea, unless an exception applies (such as a reduced rate, the zero rate or an exemption, or a reason to treat the transaction as outside scope of VAT).

Zero rate (0%)

Examples of goods and services taxable at 0%

  • Exported goods
  • Services rendered outside Korea
  • International transportation services by ships and aircraft
  • Other goods or services supplied for foreign currency

Examples of exempt supplies of goods and services

The term “exempt supplies” refers to supplies of goods and services that are not liable to VAT and that do not qualify for input tax deduction.

  • Social welfare services (for example, medical and health services and education services)
  • Goods or services related to culture (for example, books, newspapers, magazines, official gazettes and communications, artistic works, and admission to libraries)
  • Personal services similar to labor (for example, by actors, singers and academic research services)
  • Postage stamps
  • Basic life necessities and services (for example, unprocessed foodstuffs such as agricultural products, livestock products, marine products, forest products, piped water, briquette and anthracite coal)
  • Services supplied by the government
  • Finance and insurance services
  • Supplies of land

 

A global VAT/GST rate overview can be found here (note this is a work in progress).

This post was last updated on August 27, 2021.

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