South Korea See Tax Collection Boost

April 13, 2015 Taxation in South Korea

SEOUL – After years of continued tax shortfalls, tax authorities in Korea are now expecting to see a significant rise in revenues.

In a new report issued on April 13th the National Tax Service of Korea announced that the corporate tax revenues for the 2015 year could be well ahead of the government’s own estimates.

Over the four years since 2012 the government of Korea has seen persistent shortfalls in the collection of tax revenues, posting shortfalls of KRW 2.8 trillion, KRW 8.5 trillion, and KRW 10.9 trillion in 2012, 2013, and 2014 respectively.

The corporate tax revenues over the month March were 11 percent higher than during the same period in 2014.

As corporate tax revenues in Korea are paid in the year following the profit being made, authorities are now indicating that the positive economic growth seen last year could be a strong indicator that overall collections in 2015 could see a substantial rise also.

It was also noted that the increase in tax revenues could be attributed to continued efforts by tax authorities to clarify to business owners what their tax payment and filing obligations are, leading to an increased level of compliance.

Photo By: Doug Letterman