South Korea’s tax revenue in the first four months of this year expanded nearly $30 billion from a year-ago period on faster-than-expected economic recovery and asset market boom, refueling the coffers for a second supplementary budget to tend to Covid-19-battered segment.
According to the Ministry of Economy and Finance on Tuesday, the government has collected 133.4 trillion won ($119.7 billion) in taxes for the January-April period, adding 32.7 trillion won from a year earlier. The progress rate of tax revenue, or the percentage of actual tax revenue collected against annual target, was at 47.2 percent, 11.9 percentage points faster than a year ago.
The government is readying a second supplementary budget to its record-sized fiscal stimuli for this year to accelerate recovery.
President Moon Jae-in on Tuesday ordered the cabinet to use the excess tax revenue to create an extra budget to go all-out for an economic recovery as “polarization remains deep.” The government is aiming for a 4.0 percent growth this year after 1.0 percent contraction.
Tax revenue increased largely due to an 8.2 trillion won surge in revenue from corporate tax due to sharp income pickup from strong exports.
Individual income tax also made strides.
Revenue from value added tax gained 4.9 trillion won on pent-up spending on luxury item. Spike in housing prices led to transfer income tax added 3.9 trillion won and stock boom collected 2 trillion won more in levies on stock trade. Inheritance tax rose 2 trillion won, largely thanks to the dues paid by owner family of Samsung Group for the wealth left by Korea’s richest man and former chairman Lee Kun-hee. 이미지 확대
When excluding revenue from tax paid a year later, the country’s total tax income added 23.9 trillion won in the first four months.
In April alone, tax revenue rose 13.8 trillion won.
The country’s total revenue gained 51.3 trillion won to 217.7 trillion won, while spending rose 24.3 trillion won to 234 trillion won. Non-tax revenue stood at 13 trillion won in the January-April period, up 2.4 trillion won on year, and revenue from state-run funds added 16.2 trillion won to 71.3 trillion won.
The consolidated fiscal balance, or the difference between the government’s total income and spending, recorded a deficit of 16.3 trillion won during the period, narrowing the red by 27 trillion won from the previous year.
The operational fiscal balance, which excludes social security funds from the consolidated balance, also came at a loss of 40.4 trillion won, off 16.1 trillion won on year.
National debt reached 880.4 trillion won as of April.
By Lee Ha-yeon
[ⓒ Pulse by Maeil Business News Korea & mk.co.kr, All rights reserved]