2.6 Million Foreigners in Korea as of March... Increasing Every Year
Rapid Rise in National Tax Delinquency... "Institutional Measures Needed"
It has been confirmed that the national taxes overdue by foreigners amounted to 40 billion won last year.
According to data received on the 16th by Park Seong-hoon, a member of the People Power Party belonging to the National Assembly's Planning and Finance Committee, from the National Tax Service, the national taxes overdue by 4,847 foreigners residing in Korea last year totaled 39.7 billion won.
By tax category, income tax accounted for more than half at 20.6 billion won. Other taxes include value-added tax at 15.4 billion won and capital gains tax at 3.1 billion won.
The national tax arrears by foreigners have been increasing every year, from 13.4 billion won in 2019 to 14.5 billion won in 2020, 24.8 billion won in 2021, and 34.7 billion won in 2022. The number of defaulters has also surged, from 2,910 in 2019 to 2,991 in 2020, 3,392 in 2021, and 4,489 in 2022.
Rep. Park said, "Although the number of foreigners residing in Korea is increasing, it is questionable whether the tax authorities have properly established institutional measures to prevent 'tax evasion'." He added, "Since the amount of tax arrears by foreigners is also on the rise every year, it is necessary to manage overdue taxes more thoroughly."
According to the Ministry of Justice, as of March 2024, the foreign population in Korea is approximately 2.6 million. This represents a sharp increase of about 11% compared to just one year ago. Especially in non-metropolitan areas, foreign workers and international students have a significant impact on the local economy.
In the case of Anseong City, Gyeonggi Province, according to statistics from the Ministry of the Interior and Safety in 2022, the proportion of foreign residents is about 11% of the total population. This ranks as the 10th highest nationwide. Correspondingly, the national tax arrears by foreigners in the jurisdiction are also increasing.
According to the city on the 5th, as of August, there were 2,655 cases of foreign tax arrears amounting to 280 million won. This is about a 6% increase compared to last year.
Among these, automobile tax accounts for 84.4%, or 2,242 cases, with arrears totaling 228 million won. This is understood to be due to foreigners moving their residence without properly reporting their address change, causing difficulties in issuing tax bills. In particular, automobile tax is likely to become long-term overdue, and collection is virtually difficult after departure from the country.
Accordingly, the city has decided to operate a 'Special Collection Period for Foreigners' Tax Arrears' until the end of November. The city plans to take measures against habitual and chronic foreign tax defaulters, including seizure of deposits and wages, vehicle seizure, public auction, and license plate confiscation. They also plan to secure claims by seizing mandatory insurance exclusive to foreigners, such as visa extension restrictions, departure deadline insurance, and return cost insurance.
In the case of Seosan City, Chungnam Province, a separate foreign tax arrears collection team will be operated. According to the city on the 9th, the collection team will be staffed with foreigners fluent in Korean and their native languages, with one person each for languages such as Chinese and Russian, assigned to the Seosan City Collection Division office and operated for two weeks.
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