Samsung asks US to give more tax credits for chip investment

The Korea Times

The Korea Times

Business

Sun, October 1, 2023 | 07:06

Tech

Samsung asks US to give more tax credits for chip investment

Posted : 2021-09-24 16:17

Updated : 2021-09-25 09:31

A general view shows the cleanroom of German semiconductor manufacturer Infineon's new specialist power chip plant in Villach, Austria Sept. 16. Reuters-Yonhap

By Kim Yoo-chul

A senior Samsung Electronics executive has asked the Biden administration to offer more tax incentives in order to move forward with its planned massive semiconductor investments in the United States.

In a Korea Society program titled, "The US-Korea Global Partnership: Supply Chain and Semiconductors," Samsung's Kim Won-kyong, who oversees both the company's global public affairs team and corporate sustainability center, said the company's planned investment of $17 billion to build a new chip plant in the U.S. will make the Korean firm the largest foreign investor there.

"Leaders in the U.S. must encourage foreign direct investment (FDI), which is critical to Washington's strategic priorities. We urge the White House to swiftly make a decision to incentivize chip investment," Kim said in his opening remarks before the start of the program, early Friday (KST).

Samsung is set to invest $17 billion into a new chip factory in the U.S. Still, no official announcement has been made.

While Samsung has been near to choosing the city of Taylor, some 50 kilometers northeast of Austin, where it already operates massive foundry chip lines, for the construction of the new chip plant, Kim said that it is still engaged in talks with key U.S. partners to finalize the specific location(s).

According to the executive, another reason for Samsung's request for increased tax breaks is that the world's top memory chipmaker plans to apply cutting-edge processing technology to the soon-to-be-constructed new semiconductor plant.

Kim stressed that expanded tax credits will be a plus factor also in terms of strengthening the "entire chip ecosystem," adding that the firm's current $17 billion U.S. investment plan is not the first time Samsung has been engaged in Washington-led policy initiatives.

The program was organized by the Korea Society based in New York. Along with Kim, Korea Society CEO Tom Byrne discussed supply chain resilience and semiconductors in conversation with Tami Overby, former president of the U.S. Korea Business Council, and John Neuffer, CEO of the Semiconductor Industry Association.

A few hours before the talks, the White House asked chip firms and automakers to share information on the ongoing chip crisis that has led to a reduction in U.S. auto production.

Detroit's "Big Three" automakers (General Motors Company, Fiat Chrysler Automobiles and Ford Motor Company), Samsung, Apple, Daimler, BMW, GlobalFoundries, Micron Technology, Microsoft, TSMC, Intel and Ampere Computing attended the meeting.

When asked about the specifics of the White House-initiated meeting, Samsung Electronics headquarters in Seoul said that the company has no official comments.

However, Samsung's chief foundry rival, Taiwan's TSMC, released a rare statement after the meeting saying that the company was working with all interested parties to address semiconductor shortage issues, highlighting the fact that its capacity expansion in chips, using a finer 5-nanometer chip fabrication plant in the U.S. state of Arizona, will help Washington seek longer-term stability in chip supplies.

yckim@koreatimes.co.kr