[서울신문] Samsung’s US semiconductor plant construction economic effect of 10 trillion won

Foundry investment negotiations in Austin, Texas
Request for 900 billion won tax reduction from local government
Samsung “Review of New York, Arizona, and Korea for Musan”

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▲ The photo is a view of Samsung Electronics’ semiconductor plant in Austin, Texas.
Provided by Samsung Electronics

It is analyzed that the construction of a US semiconductor factory under consideration by Samsung Electronics will have an economic ripple effect of 10 trillion won in local communities. There are also observations that Samsung Electronics’ decision to negotiate tax benefits and new semiconductor investment candidates in Austin, Texas, Arizona, New York, and South Korea is imminent.

According to industry sources on the 7th, Samsung Electronics recently submitted a letter of intent for investment to the Texas State Treasury Department. A report on the economic ripple effect analyzed by the local consulting firm Impact Data Source was attached. According to this, it is estimated that Samsung Electronics will generate an economic activity of $8.9 billion (about 10 trillion won) to local communities only in the process of factory construction. It is analyzed that if the factory is actually operated, economic effects of $8.6 billion (about 9,662.1 billion won) will occur over the next 20 years through jobs and tax revenue. 2973 full-time jobs are created, and they are paid 8.3 billion dollars (about 8,325 billion won). The investment to expand the Austin semiconductor plant amounted to 17 billion dollars (about 19 trillion won).

When investment in a new plant in Austin is confirmed, construction will commence in the second quarter of the year and can be operated in the fourth quarter of 2023. The company is putting several candidates on the screen, but the industry and foreign media believe that the Austin plant expansion will be dominant. Samsung Electronics has already purchased an additional 1,04089㎡ site near the Austin plant and completed its use in December last year.

The key to’Mildang’ is’the scale of tax cuts’. According to Austin American Statesman, a local journalist, Samsung Electronics wants Travis State to get 100% tax cuts over the next 20 years, which is worth $719.3 million (about 88.1 billion won). The city of Texas demands a 50% tax cut, which amounts to 87.2 million dollars (about 98 billion won) over the next five years. Together, it is about 900 billion won, which is about 200 billion won different from the 650 million dollar (approximately 7302 billion won) suggested by the city of Austin. A local expert said, “100% tax reduction is unprecedented,” and “there will be a compromise at 70~80%.” Samsung Electronics, which is receiving’love calls’ from multiple candidate sites, said, “Texas’ high tax is a factor to consider,” and said, “If there is no improvement, we will make investments in Arizona, New York, and Korea.”

Reporter Jeong Seo-rin [email protected]