Samsung Electronics, “Economic effect of plant expansion $8.6 billion”
Promoting steady job creation and construction investment
State pressure on tax cuts
The Texas state government faced with a great blackout and singular,
Attention is drawn on whether to respond with a hot tax cut
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Samsung Electronics (005930)It has been confirmed that a request for a tax reduction of $85.47 million (approximately 970 billion won) over 20 years to Austin, Texas, which is reviewing the expansion of a semiconductor plant.
According to industry sources on the 28th, Samsung Electronics submitted a letter of intent for investment to the Texas state government and local governments near Austin City in mid-January through a local law firm, and hired for a factory expansion known as’Project Silicon Silver’ ·Investment plan revealed. Under the premise of investing in Austin, Samsung Electronics presented a total of 17 billion dollars (about 19 trillion won) to the local government. Investment in buildings and land is $569 billion, and investment in equipment is $9.93 billion. It is known that the site is planning to cover 640 acres (258,9988 m2, about 780,000 pyeong).
Samsung Electronics, which is currently considering plant candidates in Arizona and New York in addition to Texas, predicts the economic effect of the Austin expansion investment at $8.6 billion (about 9.7 trillion won) in this document. This is a family that includes not only the economic effect of direct employment, but also the cost of constructing the factory and the tax revenue paid by residents moving to the area. In particular, Samsung Electronics emphasized the employment effect by estimating 1,800 full-time employees in the newly established factory for 10 years after the factory was completed. In addition, in this document, Samsung Electronics also mentioned a plan to establish a new semiconductor high-tech process that has not been produced in the United States until now at the factory scheduled for expansion.
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Samsung Electronics promises a huge investment and has requested the City of Austin and the Travis County to reduce exemption of US$85.47 million (about 97 billion won) over the next 20 years. In this document, Samsung Electronics said several times in this document, “This project has a very high level of competitiveness.” As an alternative (Texas State), we are reviewing Arizona and New York as well as Korea, where Samsung Electronics’ headquarters is located. He expressed his intention to make a decision after final review of the location conditions with other candidate sites. They also cited the fact that they have built factories in Texas for the past 25 years and developed manufacturing, and that they have been strongly connected with the local community.
Meanwhile, the Austin plant of Samsung Electronics, which started construction in 1996 and completed in 1998, was mainly based on memory semiconductors when it was first established, but has been producing 10-nano (nm) system semiconductors from 2011. However, due to the recent cold wave in Texas, the power supply network was disrupted and the operation has been suspended since the 16th (local time). Samsung Electronics said that it minimized the damage by saying, “We heard the power outage policy from the power company in advance and prepared for the loss,” but it is known that the factory has been stopped until now, 10 days later.
Some point out that Texas, where the supply of electricity and clean water, which is essential for semiconductor production, is difficult is being pushed by another candidate for plant expansion. Therefore, attention is being paid to whether the Texas government will hold Samsung Electronics in Austin in response with strong tax cuts. An industry insider said, “The Texas state, which has been seriously damaged by the Great Blackout and the outage, has no choice but to take seriously the tax cut request proposed by Samsung Electronics in order not to lose the big fish called Samsung Electronics to other states that are subject to competition.” Explained.
/ Reporter Lee Su-min [email protected]
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