[2020 National Audit] Park Sung-joong "Government Spends Hundreds of Billions of Taxpayer Money on YouTube Channels That Don't Pay Taxes"

[Image source=Yonhap News]

[Asia Economy Reporter Seulgi Na Jo] "If you don't pay a single tax, how ridiculous must the Republic of Korea look when the government, local governments, ministries, and affiliated organizations all bring money without hesitation."

Criticism has been raised that the government is pouring hundreds of billions of won of taxpayers' money annually into Google YouTube, which avoids taxes by exploiting loopholes in the existing tax system.

On the afternoon of the 7th, Park Sung-joong, a member of the People Power Party, presented the government's YouTube advertising expenses over the past five years at the National Assembly Science, Technology, Information and Broadcasting and Communications Committee (STIBC) audit, stating, "We should not pour taxpayers' money into companies that actively avoid taxes."

According to Representative Park, the government's YouTube advertising budget was 1.3 billion won in 2016 during the Park Geun-hye administration, but it doubled to 2.6 billion won after the Moon Jae-in administration took office in 2017. The following year, in 2018, it surged to 6.2 billion won, and in 2019, it skyrocketed to 18.6 billion won. Representative Park questioned, "We don't know how much it will increase this year," adding, "While it is true to advertise where the advertising effect is high, is it acceptable for the government to pour taxpayers' money into companies that avoid taxes?"

He pointed out, "Including advertising expenses and app fees to Google, including YouTube domestically, it is estimated that about 6 trillion won is spent annually," adding, "However, Google does not pay corporate tax or network usage fees." He also explained, "Earlier this year, the National Tax Service imposed about 500 billion won in corporate tax on Google Korea, judging that although the servers are overseas, there is a domestic business site, but Google is currently appealing to the Tax Tribunal."

Representative Park criticized, "If the government, local governments, ministries, and affiliated organizations all bring money without hesitation while not paying a single tax, how ridiculous must the Republic of Korea look?" He added, "Some citizens comment, 'Do they have no shame at all?' At this rate, can we collect corporate tax and network usage fees from global content providers (CPs) such as Google?"

He continued, "Global CPs do not need to move because the government brings money even if they stay still," and raised his voice in criticism, saying, "Can domestic companies receive government advertisements like this if they avoid taxes? On one hand, efforts are being made to collect network usage fees as taxes, but on the other hand, taxpayers' money is being poured out."

In response, Choi Ki-young, Minister of Science and ICT, replied, "It seems that much effort is needed in this regard."

Jo Seung-rae, a member of the Democratic Party of Korea, also stated, "Regarding the forced in-app payments by global operators such as Google, it has been agreed in the floor leader consultation to take firm measures even during the audit," and announced plans to form a task force centered on lawmakers who have proposed related bills to respond.

He said, "The Antitrust Subcommittee of the U.S. House Judiciary Committee released a 440-page report stating that the Big Four, including Amazon and Google, abuse their dominant market power," adding, "There may be various issues such as trade in regulating global operators, but since the analysis is like this even in the U.S., there is no need to be discouraged. The Ministry of Science and ICT should also actively and proactively engage," urging.

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