S. Korea rejects Ssangyong Motor's plea for tax benefits

SEOUL, Sept. 4 (Yonhap) -- The South Korean government has rejected a plea by
Ssangyong Motor Co., which has been under bankruptcy protection since February,
to extend tax benefits for new cars for the company, officials said Friday.
The government has cut 70 percent of purchasing and registration taxes for those
who buy a new car to replace their old one to spur auto demand. The measure are
effective from May to December.
Ssangyong asked the government to extend the deadline for two to three months for
the company only because it couldn't benefit from the tax breaks due to a 77 days
sit-in strike by fired workers, that ended early last month.
"We were asked by Ssangyong Motor to extend the tax measure," said a high-ranking
government official on the condition of anonymity.
"But extending the measure for a certain company could cause allegations of
special treatment and the government will end the tax measure by the end of this
year as planned," the official said.
Ssangyong, which resumed production on Aug. 13, said its auto sales dived 72.4
percent last month from a year ago, as the company reeled from the strike that
halted production for more than two months.
Ssangyong sold 2,012 vehicles last month with domestic sales plunging 66.5
percent to 940 units and exports plummeting 76.2 percent to 1,072 units.
Ssangyong is required to submit its turnaround plan to a bankruptcy court on
Sept. 15. If the plan is deemed unviable, the court could liquidate the
debt-swamped carmaker.
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