S Korea seeks to raise top cor­po­rate and in­di­vid­ual tax rates

Muscat Daily - - BUSINESS -

Seoul, South Korea - South Korean Pres­i­dent Moon Jae-in’s gov­ern­ment plans to raise taxes on big cor­po­ra­tions and hig­h­earn­ing in­di­vid­u­als as part of ef­forts to ad­dress in­equal­ity.

Moon’s ad­min­is­tra­tion will pro­pose in­creas­ing the nom­i­nal tax rate on com­pa­nies whose tax­able in­come ex­ceeds 200bn won (US$178mn) to 25 per cent from 22 per cent, the Fi­nance Min­istry said in a state­ment on Wed­nes­day.

The in­come tax rate for in­di­vid­u­als would rise to 40 per cent from 38 per cent for those earn­ing more than 300mn won, and to 42 per cent from 40 per cent for those earn­ing more than 500mn won.

The pack­age of tax re­vi­sions would raise a net 5.5tn won of ad­di­tional an­nual rev­enue, the min­istry said. How­ever, any re­vi­sions to tax laws need to be ap­proved by par­lia­ment, where Moon’s Demo­cratic Party of Korea holds only 40 per cent of the seats. The gov­ern­ment will sub­mit its pro­posal by Septem­ber 1, the Fi­nance Min­istry said.

“Sta­ble tax rev­enue is very im­por­tant for the gov­ern­ment to play a big­ger and lead­ing role,” Fi­nance Min­is­ter Kim Dong-yeon said on Wed­nes­day. “We de­cided it was de­sir­able to ad­just tax rates for in­di­vid­u­als and con­glom­er­ates who are more ca­pa­ble.”

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