Park Dae-chul Proposes Telecommunications Expense Income Deduction Law... Annual Reduction of 1.9 Trillion Won

[Asia Economy Reporter Seulgina Jo] A ‘Telecommunication Expense Income Deduction Act’ that allows income deduction for mobile phone usage fees up to an annual limit of 1 million KRW is being promoted.

On the 24th, Park Dae-chul, a member of the Future United Party, announced that he had introduced a revision bill to the Restriction of Special Taxation Act containing this content as the first bill of the 21st National Assembly. The Telecommunication Expense Income Deduction Act is one of the Future United Party’s pledges for the 21st general election.

Park said, “Mobile phones are essentially daily necessities, but while the burden of telecommunication fees has increased, there have been no tax benefits,” and explained the background of the proposal: “To overcome the crisis of household economy suffering from the prolonged COVID-19 pandemic, we propose to apply a mobile phone usage fee income deduction system for five years temporarily to reduce household burdens.”

If the amendment passes, it is analyzed that about 1.8802 trillion KRW in telecommunication fee reductions (income deductions) will be possible annually.

According to data submitted to Park by the National Assembly Budget Office, the annual tax benefit scale from telecommunication expense income deduction is expected to be about 1.8802 trillion KRW, and the number of applicants for income deduction is estimated to be about 11.35 million people (based on 2018 taxable income). The National Assembly Budget Office estimated the annual telecommunication expense per person by income level to range from a minimum of 890,000 KRW to 1.59 million KRW based on analysis data from the Korea Institute of Public Finance.

Park emphasized, “Government support is inevitable until COVID-19 ends and household economy stabilizes,” and added, “Telecommunication fee refunds are absolutely necessary, even if temporarily, to overcome COVID-19.”

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