[2025 Audit] "Google and Apple Must Be Prohibited from Forcing In-App Payments... Corporate Taxes Are Too Low"

"Mandatory Reporting of Domestic Sales by Foreign Businesses Needed"

There have been calls to prevent global platform companies operating smartphone app markets, such as Google and Apple, from forcing in-app payments. Criticism has also been raised regarding the relatively low amount of corporate tax these companies pay.

On the morning of October 14, Assemblyman Lee Junghun of the Democratic Party of Korea stated during the National Assembly’s audit of the Broadcasting, Media, and Communications Committee under the Science, ICT, Broadcasting, and Communications Committee, "Although there is a law in Korea that prohibits the compulsory use of in-app payments, excessive fees are still being charged."

Yonhap News Agency

Currently, when purchasing paid apps or content on devices equipped with mobile operating systems such as Android (Google) and iOS (Apple), a fee of around 30% is imposed. In August 2021, the National Assembly passed the world’s first law prohibiting the compulsory use of in-app payments, through a partial amendment to the Telecommunications Business Act. However, the two major platform companies have set fees for third-party payments even higher than those for in-app payments, rendering the law virtually ineffective.

Assemblyman Lee also criticized the Korea Communications Commission for failing to collect fines imposed on Google and Apple for forcing in-app payments, stating, "As time passes, a significant amount of in-app payment fees continues to flow out," and adding, "The Broadcasting, Media, and Communications Committee, which is the competent authority, has failed to fulfill its role."

He also pointed out that global platform companies pay less corporate tax compared to domestic companies. Assemblyman Lee noted, "In 2023, Naver reported sales of 9.67 trillion won and paid 496.3 billion won in corporate tax, whereas Google reported sales of 365.3 billion won and paid only 15.5 billion won in corporate tax." He further cited research by the Korean Association for Management Accounting and others, stating, "Google’s actual sales amount to 12.135 trillion won."

He stressed the urgent need to establish legal and institutional measures to mandate the reporting of domestic sales by foreign businesses or to strengthen accounting transparency. He urged, "Relevant ministries should work together to promote the implementation of a digital tax and mandatory domestic sales reporting system."

Assemblyman Lee emphasized, "The market economy is being reorganized around online platforms, and platforms have already become essential to people’s daily lives." He added, "We must recognize platforms not merely as private services but as public infrastructure."