Uncollected National Tax Revenue of 9.4 Trillion Won by August... Corporate Tax Decreased by 16.8 Trillion Won

Ministry of Economy and Finance, August National Tax Revenue Status

National tax revenue through last month this year has decreased by 9.4 trillion won compared to the previous year. This is due to a decline in corporate tax interim payments caused by poor corporate performance and a reduction in income tax resulting from an increase in child tax credit payments.

According to the 'National Tax Revenue Status for August 2024' announced by the Ministry of Economy and Finance on the 30th, tax revenue from January to August this year totaled 232.2 trillion won. This is 9.4 trillion won (3.9%) less than the same period last year.

The progress rate against the national tax revenue budget (367.3 trillion won) stands at 63.2%. This is a slight improvement compared to the progress rate of 60.3% for the same period last year, which experienced the worst tax shortfall in history.

Tax revenue for the month of August amounted to 23.4 trillion won, a decrease of 600 billion won (2.6%) compared to the same month last year. The main factor behind the tax shortfall was a 1.3 trillion won decrease in corporate tax interim payment amounts compared to one year ago. On a cumulative basis from January to August, corporate tax revenue was 45.6 trillion won, a sharp drop of 16.8 trillion won (26.9%) compared to the previous year.

Yoon Su-hyun, head of the Tax Analysis Division at the Ministry of Economy and Finance, said, "Despite strong corporate performance in the first half of the year, the poor performance last year resulted in weak corporate tax interim payment results in August," adding, "We expect the total corporate tax interim payment amount to decrease by about 2 trillion won compared to last year through September."

Income tax revenue through last month was 77.1 trillion won, a decrease of 100 billion won (0.1%) compared to the same period last year. Although earned income increased due to higher bonus payments following wage collective bargaining agreements, income tax slightly decreased year-on-year due to increased child tax credit payments and a decline in capital gains tax, the Ministry explained.

Along with corporate tax and income tax, value-added tax (VAT) revenue, one of the three major tax categories, increased. VAT revenue from January to August was 59 trillion won, up 7.1 trillion won (13.6%). This is analyzed to be influenced by a decrease in domestic refund amounts and an increase in import payments due to higher imports.

Inheritance and gift tax revenue amounted to 10.7 trillion won, 500 billion won (4.5%) more than the same period last year. Customs duties decreased by 100 billion won (2.2%) due to a decline in imports.

Securities transaction tax revenue was 3.5 trillion won, down 700 billion won (15.9%) compared to the same period last year, despite a slight increase in stock trading volume, due to the expanded effect of the tax rate reduction. While the government postponed the introduction of the financial investment income tax, it decided to lower the securities transaction tax rate from 0.2% last year to 0.18% this year.