National Tax Revenue Up 21.3 Trillion Won Through May... "Tax Revenue Re-Estimate in September"

Ministry of Economy and Finance Releases May National Tax Revenue Status
Uncertainty Grows for Real Estate, Stock Transactions, and Customs Duties

From the beginning of this year through last month, national tax revenue increased by 21.3 trillion won compared to the same period last year, when a tax revenue shortfall occurred. This increase was mainly due to higher corporate tax revenue, which was influenced by the recovery in corporate performance and an increase in interest and dividend income last year. However, tax revenue from categories directly tied to domestic demand decreased. As a tax revenue shortfall is expected for the third consecutive year, the government plans to announce a significantly revised tax revenue estimate, much lower than the original budget, in September.

According to the "National Tax Revenue Status for May 2025" released by the Ministry of Economy and Finance on June 30, tax revenue for January through May this year reached 172.3 trillion won. This is an increase of 21.3 trillion won (14.1%) compared to the same period last year.

The progress rate compared to the national tax revenue budget (382.4 trillion won) is 45.1%. This is an improvement over the 41.1% progress rate during the same period last year. This means that, compared to the government’s plan, tax collection is proceeding better than last year, when there was a large-scale shortfall. However, it still falls short by 1.1 percentage points compared to the five-year average (46.2%), indicating a significantly sluggish situation.

As a result, the likelihood of a tax revenue shortfall occurring for the third consecutive year has increased, and the government will conduct a tax revenue re-estimate in September. Last year, the government announced that it would make the September tax revenue re-estimate an annual practice.

Cho Moonkyun, Director of Tax Analysis at the Ministry of Economy and Finance, stated, "The progress rate for major tax categories such as corporate tax and value-added tax is still sluggish, and there is considerable uncertainty regarding tax revenue conditions for categories such as capital gains tax, comprehensive income tax, and customs duties. Therefore, as we move into the second half of the year, the size of the tax revenue shortfall may either grow or shrink."

In May alone, tax revenue amounted to 30.1 trillion won, an increase of 4.7 trillion won (18.3%) compared to the same month last year. The main factor was a 1.6 trillion won increase in capital gains tax, which resulted from an increase in overseas stock declaration performance.

Corporate tax increased by 1.4 trillion won due to factors such as an increase in installment payments for final returns from small and medium-sized consolidated corporations, resulting from improved corporate performance last year.

For the cumulative period from January to May, corporate tax revenue reached 42.7 trillion won, a sharp increase of 14.4 trillion won (51%) compared to the previous year.

Through last month, income tax revenue amounted to 57.7 trillion won, an increase of 6.2 trillion won (12.1%) compared to the same period last year. The Ministry of Economy and Finance explained that this was due to increased collection of earned income tax, resulting from expanded bonus payments and a rise in the number of employees, as well as an increase in capital gains tax revenue due to higher payments for finalized overseas stock returns.

Value-added tax revenue decreased due to a contraction in domestic demand. For January through May, value-added tax revenue totaled 38.4 trillion won, a decrease of 400 billion won (1.1%).

Securities transaction tax revenue was 1.3 trillion won, down 100 billion won (43.7%) from the same period last year, due to a decrease in stock trading volume.

Inheritance and gift tax revenue was 7.5 trillion won, 600 billion won (8.5%) higher than the same period last year. Transportation tax revenue also increased by 800 billion won (17.4%), influenced by the partial restoration of the flexible fuel tax rate.