Tax Revenue Increased by 48 Trillion Won from January to October... Corporate Tax Up, Securities Transaction Tax Down

Ministry of Economy and Finance, 'October National Tax Revenue Status'

[Asia Economy Sejong=Reporter Kwon Haeyoung] Tax revenue collected up to October this year amounted to 356 trillion won, an increase of 48 trillion won compared to the previous year. This increase is due to higher collections of corporate tax, income tax, and value-added tax. However, the concern lies in next year's tax revenue, which is expected to decline significantly as corporate earnings improvement slows down due to economic downturn. Securities transaction tax has sharply decreased due to a reduction in securities trading volume caused by a sluggish stock market.

On the 29th, the Ministry of Economy and Finance announced the 'October National Tax Revenue Status' report containing these details.

The cumulative national tax revenue from January to October this year was 355.6 trillion won, an increase of 48.2 trillion won (15.7%) compared to the same period last year. By tax category, corporate tax revenue from January to October was 99.8 trillion won, a sharp increase of 48.4% compared to the previous year. Corporate tax increased as the operating profits of KOSPI December fiscal year-end corporations improved by 58.2% last year and 7.4% in the first half of this year.

Income tax revenue recorded 108.5 trillion won, up 12.7% (12.2 trillion won) from the same period last year, mainly due to recovery in employment leading to increases in earned income tax and comprehensive income tax.

Value-added tax rose by 10.7% (7.7 trillion won) to 79.6 trillion won during the same period as consumption and imports recovered from the COVID-19 shock. Retail sales in the third quarter of this year recorded 139.8 trillion won, significantly higher than 130.3 trillion won in the same period last year.

On the other hand, due to the temporary reduction of fuel tax, transportation, energy, and environmental taxes shrank by 34.1% (4.9 trillion won) to 9.4 trillion won. Securities transaction tax also decreased by 37.0% (3.3 trillion won) to 5.5 trillion won due to a decline in securities trading volume.

The tax revenue progress rate up to October is 89.7%. This means that this portion of the annual national tax revenue forecast of 396.6 trillion won (based on the second supplementary budget) has been collected so far. This is 0.5 percentage points higher than the average progress rate over the past five years.