AI data centers to be designated as national strategic technology facilities

(Yonhap)

The South Korean government will designate artificial intelligence (AI) data centers as national strategic technology commercialization facilities so that they can receive various tax benefits. It will also accelerate a 100 trillion won ($72.71 billion) support initiative aimed at fostering high-tech industries such as semiconductors.
These measures were unveiled after the National Policy Planning Committee, which serves as a presidential transition team for the Lee Jae-myung administration, received policy briefings from the Ministry of Economy and Finance, Ministry of Science and ICT, Ministry of SMEs and Startups, and others on Wednesday. The goal is to actively support advanced industries such as AI, semiconductors, and biotechnology to discover new growth engines amid a period of low economic growth.
Under the plan, the Ministry of Economy and Finance will classify AI data centers as facilities for national strategic technology commercialization and expand related tax incentives. The government currently provides a 15 to 25 percent tax credit on investments in eight designated fields, including semiconductors and secondary batteries, and it now plans to expand the scope of support to include the AI sector as well.
The Ministry of Science and ICT plans to establish an inter-ministerial policy office to act as a control tower for AI policy and to foster an AI semiconductor ecosystem to serve as an alternative to graphics processing units (GPUs).
This move aims to materialize Lee’s campaign pledge of investing 100 trillion won in strategic industries and to significantly expand related policy financing. The government initially planned to establish a 50 trillion won advanced industry fund under the Korea Development Bank (KDB) to support areas such as secondary batteries, robotics, and defense, and now aims to further scale up the fund with the participation of pension funds and others.
“The new administration began with the goal of achieving ‘real growth,’” Lee Han-joo, the chair of the committee, said. “Rather than focusing on demand-led strategies or construction-oriented growth, we must lead and innovate in the global market through our own technologies.”
The government will implement measures to boost consumption, such as increasing the credit card income deduction rate for small business owners, at the same time as it aims to respond to the economic situation by supporting both new growth industries and domestic demand.
In its report to the committee, the Ministry of Economy and Finance proposed raising the credit card income deduction cap based on the number of children and expanding the basic tax deduction per child. It also proposed including childcare facility fees in the education expense tax credit category.