This report recommends improvement plans for the Korean tax system, focusing on expansion of tax base and streamlining of tax system.
For plans to broaden tax base in the near future, this report suggests to limit or abolish some tax exemption items as well as to impose a tax on retained excessive money at firms. Mid-term plans include levying Value Added Tax (VAT) on financial services, decreasing interest tax and imposing tax on capital gains to individual shareholders, etc.
In order to streamline tax system, the report proposes to reform simplified taxation of VAT and to adjust level of Earned Income Tax Credit (EITC) .
In case of the National Assembly Budget Office’s recommendations above come into effect all together, about 3.4 trillion won of tax revenue is expected to increase after 2012. By measures to expand tax base, 4.6 trillion won of tax revenue is forecasted to increase. However, 1.2 trillion won of tax revenue is forecasted to decrease by streamlining tax system.
For plans to broaden tax base in the near future, this report suggests to limit or abolish some tax exemption items as well as to impose a tax on retained excessive money at firms. Mid-term plans include levying Value Added Tax (VAT) on financial services, decreasing interest tax and imposing tax on capital gains to individual shareholders, etc.
In order to streamline tax system, the report proposes to reform simplified taxation of VAT and to adjust level of Earned Income Tax Credit (EITC) .
In case of the National Assembly Budget Office’s recommendations above come into effect all together, about 3.4 trillion won of tax revenue is expected to increase after 2012. By measures to expand tax base, 4.6 trillion won of tax revenue is forecasted to increase. However, 1.2 trillion won of tax revenue is forecasted to decrease by streamlining tax system.
Choi Cheun-gyu, Kim Daechul, Kang Minji,
Sung Myung-kee, Shin Youngim, Chang Yoonjeong
Sung Myung-kee, Shin Youngim, Chang Yoonjeong