S. Korea to boost tax incentives on battery sector

South Korea's battery makers and related firms will receive up to a 50 percent tax discount for R&D spending and 20 percent tax cuts on facility investment under the Ministry of Trade, Industry, and Energy's K-battery blueprint.

The ministry aims to nearly triple battery exports from $7.5 billion in 2020 to $20 billion by 2030.

The nation's three battery makers, LG Energy Solution Ltd., Samsung SDI Co., and SK Innovation Co., vowed to invest a combined 40 trillion won over the next decade.

The trio accounted for a third of the global EV battery market last year.

However, calls for broader support for South Korea's battery trio have risen as the US, Europe, and China step up efforts to secure the manufacturing base, battery technology, and supply chains of the rapidly growing EV battery market.

The ministry will also collaborate with the battery makers and related agencies to develop next-generation batteries with enhanced safety, energy efficiency, and range.

While lithium-ion batteries currently dominate the EV battery market, the country will seek the commercialization of the solid-state battery, which is considered a safer and more energy-efficient option for EVs, by 2027.

The country plans to develop a lighter lithium-sulfur battery for drones and aircraft by 2025.

South Korea vowed to cooperate with the private sector in R&D projects to enhance lithium-ion batteries' capacity and safety by improving the chemistry mix and cell structure.

A "next-generation battery park" is set to rise in 2026 to facilitate local firms' research and test efforts.

Local companies would also receive assistance in securing key resources for batteries and exploring ways to reuse materials from spent batteries.