[Tax Column] Disagreement Persists Over Top Rate for Separate Taxation of Dividend Income..."30% Not Decided"

Lowering the Top Tax Rate... Ruling and Opposition Parties in Agreement, but Some Ruling Party Members Oppose "Tax Cuts for the Wealthy"
Park Sooyoung: "Aiming for Passage This Week via Sub-Subcommittee on the 27th and Plenary Session on the 28th"

On November 26, the Tax Subcommittee of the National Assembly's Planning and Finance Committee failed to narrow differences over the top tax rate for separate taxation of dividend income. The widely circulated speculation that the top rate would likely be set at 30% was also found to be untrue. Initially, both the ruling and opposition parties had seriously considered lowering the top rate from the government's proposal of 35% to 25%.

On the 26th, the Tax Subcommittee of the Planning and Finance Committee is being held at the National Assembly in Yeouido, Seoul. November 26, 2025. Photo by Kim Hyunmin

Park Sooyoung, chair of the Tax Subcommittee and a member of the People Power Party, met with reporters during the subcommittee session at the National Assembly and dismissed claims that a consensus had been reached on a 30% top rate, stating, "It is completely untrue that we have fixed the rate at 30%."

Some members of the Democratic Party of Korea continue to oppose lowering the top rate, arguing that reducing the top rate for separate taxation of dividend income amounts to a tax cut for the wealthy. Park said, "We started with the atmosphere being very close to 25%, but about two Democratic Party lawmakers insist on sticking to the 35% plan, calling it a tax cut for the rich," adding, "Tomorrow, we need to hear the ruling party's exact position from Secretary Chung Taeho."

He went on to mention that the Democratic Party leadership is considering lowering the top rate for separate taxation of dividend income to 25%, expressing frustration by saying, "The party leadership has set a policy (to lower the top rate), but individual statements are causing difficulties."

When asked whether the bill on separate taxation of dividend income would pass within the week, Park replied, "Of course, our goal is to pass it this week," adding, "We are aiming for an agreement at the sub-subcommittee meeting tomorrow, and the reason we have scheduled the plenary meeting for the day after is to pass this bill."

The Tax Subcommittee plans to hold a sub-subcommittee meeting on the morning of November 27 to discuss contentious bills, including those on the separate taxation of dividend income, corporate tax, and education tax.

This content was produced with the assistance of AI translation services.