Tax-Saving Tactics Behind the Pink Muhly Café

The Mega Cafes and Tax-saving Strategies

Recently, I came across an interesting article suggesting that one of the reasons for the rapid increase in mega bakery cafes in Korea is related to tax-saving strategies. There is a system in place that allows up to $45 million in inheritance tax exemptions when small and medium-sized enterprises are passed down to children. In particular, in the bakery industry, if the heir works for the business for a certain period and continues to manage it after inheritance, it is known that the inheritance tax can be significantly reduced. Due to these conditions, mega bakery cafes are being utilized as an effective long-term method for reducing inheritance taxes.

Pink Muhly in "Pins Coffee"

Perhaps because of this background, mega bakery cafes reminiscent of theme parks, rather than small bakeries, are becoming a major trend in Korea. These cafes offer more than just bread and coffee, providing a romantic atmosphere and unique experiences that captivate many, especially the younger generation.

On a clear autumn day, I visited “Pins Coffee” in Cheonan, known for the pink muhly field located behind the café. The autumn landscape, featuring pink muhly and silver grass, was carefully curated by the café and created an impressive visual experience.

However, the 30-minute wait in line to purchase coffee at the entrance proved to be a challenge for many visitors. Conversations among others in the line, including discussions on ‘mega cafes and tax-saving strategies,’ indicated mixed reactions to the overall experience.

A view of the Pink Muhly and Pins Coffee

Address

27-29 Haesol 1-gil, Dongnam-gu, Cheonan-si, Chungcheongnam-do, Korea

Amenities: EV Charging Stations

The café is located in a spacious area on the outskirts, with a large parking lot. BMW and G-Charger have partnered to provide EV chargers at relatively affordable rates. However, it's unclear what contribution BMW made beyond offering its brand name for the installation of the chargers.

The café’s large parking lot and EV charging stations

Conclusion

Mega bakery cafes on the outskirts of cities offer a wide range of experiences and ample space to enjoy. Typically, businesses valued at up to 60 billion KRW need to operate continuously for 10 years to qualify for inheritance tax benefits. During this time, even if profits are modest, maintaining these cafes is necessary. Any coffee lovers would better pay a visit to these cafes and enjoy their ambiance. It can be a worthwhile experience.