Foreign Tourists Still Concentrated in Seoul

More Than Five Times the Second Most Searched in Busan
"Special Refund Exemption Should Be Applied to Food Service"

It was found that 81.8% of foreign tourists are concentrated in Seoul. According to data from the Ministry of Culture, Sports and Tourism's national audit, released on the 10th by Lee Byung-hoon, a member of the National Assembly's Culture, Sports and Tourism Committee from the Democratic Party of Korea, 263,986 foreign tourists visited Korea in July alone. Although this is nearly three times more than the same period last year, the concentration in Seoul remains unchanged. It was more than five times higher than Busan (15.6%), the second most visited city. Except for the three regions including Gyeonggi-do (10.7%), the visitation rates to other regions were all in single digits.

Rep. Lee pointed out, "This trend has continued for the past 10 years," adding, "Tourists head only to Seoul, and visits to regional areas are not happening." He emphasized, "Since a significant number of tourists enjoy backpacking, efforts to attract tourists by highlighting regional characteristics are necessary," and stressed, "System improvements are also needed, such as applying special VAT refund provisions for food services and providing immediate refund services."

Under current law, foreigners receive a refund of value-added tax (VAT) and individual consumption tax at the airport upon departure if they purchase goods at domestic duty-free shops. However, food and beverage services are not eligible for these benefits. A partial amendment to the Restriction of Special Taxation Act, which introduces special refund provisions, has been proposed in the National Assembly, but the Ministry of Economy and Finance opposes its expansion, judging that the resulting tax revenue loss would reach 340 billion KRW annually.

Rep. Lee argued, "If the special refund provisions are applied only to regions excluding the metropolitan area, the proportion of tax revenue loss would not be high," and insisted, "Increasing sales through tourism activation would be more helpful in strengthening the tourism foundation than supporting local small merchants with cash loans or subsidies."