Donate to Regions, Receive Tax Credits and Gifts
Total Amount Raised Jumps 72% Year-on-Year
Higher Tax Credit Rates to Encourage 200,000-Won Donations
The "Hometown Love Donation Program," introduced by the government to revitalize regional economies, continues to be a runaway success. The total amount raised last year reached 151.5 billion won, up 72% from the previous year. Local governments are responding swiftly by creating dedicated teams for the program or expanding related projects.
According to the Ministry of the Interior and Safety on February 12, donations made through the Hometown Love Donation Program, which was introduced in 2023, increased from 65.1 billion won in its first year of implementation to 87.9 billion won in 2024, and then to 151.5 billion won last year. Under this program, if an individual donates to a local government other than the one in which they reside, they receive both a tax credit and local specialty products (thank-you gifts) from that region. Donations of up to 100,000 won are fully eligible for tax credits, and donors receive 30,000 won worth of thank-you gifts, so it can be considered a beneficial arrangement.
It is also notable that participation is high among people in their 30s and 40s, who are in their prime working years. Looking at last year's donations by age group, those in their 30s accounted for the largest share at 34.9%, followed by those in their 40s at 27.9% and those in their 50s at 20.4%. Among a total of 243 local governments, the 89 classified as depopulated areas raised an average of 760 million won last year, which is 1.7 times the amount raised by non-depopulated areas, indicating that fundraising has been particularly active in vulnerable regions.
Park Yoojung, Director of the Balanced Development Promotion Division at the Ministry of the Interior and Safety, said, "Donation data is automatically transmitted to the National Tax Service, and the funds are used for local governments' public welfare projects or disaster recovery," adding, "Through public participation, we can boost regional economies and at the same time raise awareness of areas facing population extinction, achieving two goals at once."
Looking at last year's donations, contributions of 100,000 won or less, which are fully eligible for tax credits, accounted for 98.4% of the total. To encourage this kind of "value-focused" participation, the ministry has raised the tax credit rate on the portion of donations exceeding 100,000 won and up to 200,000 won from the previous 16.5% to 44% starting this year. Last year, if someone donated 200,000 won, 100,000 won was fully covered by a tax credit, and the remaining 100,000 won was subject to a 16.5% tax credit rate, resulting in a total tax credit of 116,500 won. From this year, however, the remaining 100,000 won will be subject to a 44% tax credit rate, allowing donors to receive a tax credit of 144,000 won. On top of that, they receive 60,000 won worth of local specialty products, bringing the total benefit to 204,000 won.
The Ministry of the Interior and Safety is also pushing to expand the scope of donors from individuals to corporations. Regarding this, Director Park said, "In light of the potential impact on tax revenue, we plan to design the system carefully through consultations with the Ministry of Economy and Finance." The ministry also plans to increase the number of private platforms used as donation channels from the current nine to more than fifteen to broaden points of contact with donors.
Local governments, for their part, are drawing up plans to further activate the Hometown Love Donation Program, which has become a "hit product." Chuncheon City in Gangwon Province has launched a search for new thank-you gifts to offer donors under the slogan "Let’s find the second Dakgalbi." Wonju City in Gangwon Province recently established a dedicated team for the Hometown Love Donation Program, assigning it responsibilities such as promotion and planning. Taean County in South Chungcheong Province has set this year's fundraising target at 500 million won and decided to strengthen recognition for major donors by creating a hall of fame for those who donate 1 million won or more.
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