Rep. Kim Tae-ho Leads Amendment to Local Allocation Tax Act ... Supporting Regional Balanced Development

Kim Tae-ho, member of the People Power Party.

[Asia Economy Yeongnam Reporting Headquarters Reporter Choi Soon-kyung] Kim Tae-ho, a member of the National Assembly from the People Power Party (Gyeongnam Sancheong·Hamyang·Geochang·Hapcheon), has taken the lead in proposing the "Local Allocation Tax Act Amendment Bill," which includes a phased increase in the local allocation tax to contribute to expanding the financial base of local governments and promoting balanced development.

The current Local Allocation Tax Act stipulates that funds necessary for the administrative operation of local governments are provided to adjust finances and develop local administration.

However, the current law sets the local allocation tax base at 19.24% of the total domestic tax revenue, a rate that has remained unchanged since it was raised in 2006.

Meanwhile, issues such as population decline and aging are causing local extinction problems, and there have been continuous calls for serious discussions on additional transfers of central government resources to local governments to promote local autonomy and regional balanced development.

Accordingly, the amendment bill includes provisions to gradually increase the local allocation tax rate from the current 19.24% of total domestic tax revenue to 24% by 2024, aiming to strengthen the financial base and balanced development of local governments.

Assemblyman Kim emphasized, "In the urgent situation of deteriorating local finances and population decline, it is necessary to promote fiscal decentralization by gradually increasing the local allocation tax rate at a time when balanced regional development is critical. We must ensure local financial autonomy and achieve substantial regional development to overcome the crisis of local extinction."