Seoul, South Korea – The South Korean Shipping Association (KSA) has secured a major victory for the nation's ferry industry, with the passage of a new law granting significant tax breaks to domestic passenger ships.

The newly amended Local Tax Special Act, which was co-sponsored by lawmakers Wi Seong-gon and Bae Jun-young, will provide tax relief on both acquisition and property taxes for passenger vessels operating on domestic routes. The tax benefits will be in effect for three years, from January 1, 2024, to December 31, 2027.

The KSA has been advocating for these tax breaks for some time, arguing that domestic passenger ships, which serve as a vital lifeline for many island communities, have been unfairly excluded from tax benefits previously granted to cargo ships and international vessels. The new law addresses this disparity, providing ferry companies with much-needed financial relief.

"This is a significant achievement for the ferry industry," said KSA Chairman Lee Chae-ik. "By reducing the financial burden on ferry companies, we can expect to see improvements in service quality, as well as investments in new, more environmentally friendly vessels."

The tax breaks are expected to save the ferry industry approximately 96 billion won (approximately US$72 million) over the next three years. With these savings, ferry companies can invest in upgrading their fleets, improving safety standards, and enhancing passenger comfort. Additionally, the reduced operating costs may allow companies to offer more competitive fares, attracting more passengers and stimulating tourism in coastal regions.

The new law is expected to have a positive impact on both the ferry industry and the communities it serves. By providing ferry companies with the financial resources they need to thrive, the government is investing in a more sustainable and resilient transportation system.