2024-08-02 00:49:46
Corporate tax cut by 16 trillion won due to economic slowdown
Inheritance tax and securities transaction tax revenues also decreased
If we continue like this, we will have a deficit of 30 trillion by the end of the year.
It has been revealed that the government collected about 10 trillion won less in taxes this year through June than a year ago. Usually, more than half of the annual tax revenue target is received by June, but this year, it has not even reached half. Even if the remaining period is the same as last year, there will be a shortfall of more than 30 trillion won, making it certain that there will be a tax revenue deficit for the second consecutive year.
According to the ‘June National Tax Revenue Status’ released by the Ministry of Strategy and Finance on the 31st, national tax revenue from January to June totaled 168.6 trillion won, down 9.98 trillion won (5.6%) from a year ago. This is 45.9% of this year’s tax revenue target (367.3 trillion won). Last year, when there was a 56 trillion won tax revenue shortfall, only 44.6% of the original target was collected in half a year, and this year’s situation is similar. It is significantly slower than the average progress rate (52.5%) over the past five years.
The main reason for the lower tax collection was corporate tax. As of June, corporate tax revenue was only 30.7 trillion won, down 16.1 trillion won (34.4%) from a year ago. This is because the number of companies with ‘zero corporate tax’, including Samsung Electronics and SK Hynix, increased due to worsening corporate performance last year due to the economic downturn.
There is also a trend of reducing property-related taxes. During this period, comprehensive real estate taxes were collected at 1.2 trillion won, down 400 billion won (27.4%) from a year ago. This is interpreted as the result of the government increasing the basic deduction amount for comprehensive real estate taxes and significantly lowering the assessed real estate prices since last year. Starting this year, securities transaction tax rates have been lowered, and securities transaction tax revenues have also decreased by 300 billion won (9.5%).
On the other hand, as consumption increased, value-added tax was collected at 41.3 trillion won, an increase of 5.6 trillion won (15.7%) from a year ago. Income tax revenue also increased by 200 billion won (0.3%). This is because interest income tax increased due to high interest rates, and the number of employed people increased, leading to more people paying earned income tax.
As concerns about a tax shortfall grow, the government decided to review the national tax revenue status for July and August and decide whether to prepare a new tax budget. As of now, even if taxes are collected in the second half of this year (July to December) at the same level as last year, there will be a deficit of 33.1 trillion won. However, if the performance of income tax, transfer tax, and corporate tax interim advance payments improves compared to last year, the deficit size could be smaller than this.
Sejong = Reporter Song Hye-mi [email protected]
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2024-08-02 00:49:46