Gwangju Citizens Save 11.8 Billion Won in Taxes Through Annual Car Tax Prepayment

[Asia Economy Honam Reporting Headquarters Reporter Park Seon-gang] Citizens of Gwangju received a tax deduction benefit of 11.8 billion KRW last month through advance payment of automobile tax, saving an average of 28,505 KRW per vehicle.

Gwangju Metropolitan City announced on the 9th that as a result of receiving advance payment applications for automobile tax last month, 412,776 applications were submitted, an increase of 41,091 compared to January of last year, with a payment amount of 116.7 billion KRW.

Based on the registered number of vehicles in Gwangju, 693,200 units (as of the end of January 2021), 6 out of 10 vehicles used the advance payment system to pay automobile tax, accounting for 70.6% of the automobile tax collection target of 165.3 billion KRW.

The number of advance payment applications has been increasing every year, which is analyzed to be due to the higher deduction rate of the automobile tax advance payment compared to bank interest rates (market interest rates of 1% to 1.8%).

The automobile tax advance payment system allows taxpayers to pay the automobile tax, which is usually paid twice a year in June and December, in advance and receive a 9.15% deduction on the annual amount. Taxpayers who miss the January advance payment application can receive deduction benefits of 7.5% in March, 5% in June, and 2.5% in September.

Advance payment of automobile tax can be applied for by visiting the district tax office in person or by phone, and applications can also be made through ARS phone service or the Wetax system.

Kim Il-yong, Director of the City Autonomous Administration Bureau, said, “Using the automobile tax advance payment allows taxpayers to enjoy tax savings while local governments secure early funding for regional finances, achieving two goals at once. Taxpayers who missed the application can apply for advance payment in the upcoming March and receive deduction benefits for the subsequent tax periods.”

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