finance minister-tax revenue

▲ Finance Minister Choo Kyung-ho speaks during a meeting with reporters in the central city of Sejong on May 30, 2023. (PHOTO NOT FOR SALE) (Yonhap)

finance minister-tax revenue

S. Korea's tax revenue to stay sluggish for time being: Choo

By Kang Yoon-seung

SEOUL, May 30 (Yonhap) -- South Korea's tax revenue is expected to remain sluggish for the time being due to weak corporate performances and a slump in the property market, the finance minister said Tuesday.

The remark came as South Korea's tax income slipped 24 trillion won ($18.1 billion) on-year in the first three months of 2023 following a slump in the real estate sector. In March alone, the country's tax revenue came to 32.8 trillion won, down 8.3 trillion won from the previous year.

"Recently, tax revenue missed expectations due to a decline in corporate and capital gain taxes," Finance Minister Choo Kyung-ho said during a meeting with reporters, attributing the decrease to the weak business performances and the sluggish property market.

Choo, however, said South Korea is not considering an extra budget, noting the government will instead seek to utilize surplus money from the previous year as well as other reserve funds.

"Even if the situation deteriorates further, the government currently has various options to cope with it. Thus, we are not considering an extra budget for now," the minister said.

In regard to the country's economic growth, Choo emphasized that conditions are expected to improve in the second half of 2023, despite the slower-than-anticipated growth observed in the first half of the year.

Last week, the Bank of Korea lowered its growth outlook for South Korea to 1.4 percent from a 1.6 percent expansion predicted three months earlier. Earlier this month, the state-run Korea Development Institute (KDI) also slashed its growth outlook by 0.3 percentage point to 1.5 percent.

"(The adjustment by the central bank and the KDI) came as the economic situation for the first half was worse than expected," he said.

The government plans to release its updated estimate of this year's growth, which currently stands at 1.6 percent, at the end of this month or early July.


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