"Financial Strain Deepens Due to Tuition Reduction"…Daekyohyeop Proposes 'Higher Education Financial Support'

Request to Increase University Innovation Support Project Budget to Over 2 Trillion Won
Demand to Minimize Universities Failing the 3rd Cycle Competency Diagnosis
Abolition of Newly Imposed Local Taxes on Private Universities

Details of Tuition and Admission Fee Deficits and Additional Scholarship Burden Estimated by the Korea Council for University Education

[Asia Economy Reporter Han Jinju] Universities facing financial difficulties due to years of frozen tuition fees have requested the government for 'higher education financial support' citing worsening finances.

On the 10th, the University Education Council (Daekyo-hyeop) stated, "University finances have been continuously deteriorating due to the rapid decline in the school-age population and 13 years of frozen university tuition fees," adding, "University competitiveness is steadily declining, and to enhance international competitiveness through qualitative improvement of higher education, we have recently proposed financial support through meetings with senior officials from the Ministry of Education and the Ministry of Strategy and Finance."

The financial support measures proposed by Daekyo-hyeop include ▲ a significant increase and conversion to general support of the University Innovation Support Project budget ▲ minimizing failures in the 3rd cycle University Basic Competency Diagnosis ▲ abolition of newly imposed local taxes on private universities ▲ introduction of a university donation tax credit system.

Daekyo-hyeop claims that due to COVID-19, expenses for quarantine measures have occurred, rental and dormitory operation revenues have sharply declined, and personnel costs have increased by 1.4762 trillion won compared to 2011, worsening the conditions for education and research.

Daekyo-hyeop requested a substantial increase in the University Innovation Support Project budget from 695.1 billion won this year to over 2 trillion won. According to Daekyo-hyeop's calculations, the loss in tuition and course fee income amounts to 1.6702 trillion won, loss from abolition of entrance fees is 97.3 billion won, and additional burden from on-campus scholarships is 398.5 billion won, totaling 2.166 trillion won.

Daekyo-hyeop stated, "The University Innovation Support Project budget should at least compensate for the loss of income caused by frozen tuition and abolition of entrance fees, as well as the additional burden of on-campus scholarships due to Type 2 national scholarships," and added, "Considering that these are government policy matters, the use of operating expenses should be permitted."

They also requested minimizing the number of universities failing the 3rd cycle University Basic Competency Diagnosis scheduled to be announced in August, and that all universities meeting certain criteria be selected and supported. They asked to expand the scope so that as many universities as possible can receive financial support, excluding universities under financial support restrictions or those at the limit. In the 2nd cycle, 143 out of 198 universities received support.

Additionally, Daekyo-hyeop requested the abolition of local taxes imposed on private universities, which are set to expire at the end of the year. If the Local Tax Special Cases Act is applied, universities are expected to pay about 500 billion won in additional taxes annually. The Local Tax Special Cases Act imposes acquisition tax, property tax, regional resource facility tax, registration license tax, and resident tax on educational purpose real estate (land, buildings, aircraft, ships, etc.). They also advocated for the introduction of a university donation tax credit (up to 500,000 won per person annually).

Kim In-cheol, chairman of Daekyo-hyeop, said, "Higher education competitiveness is directly linked to national competitiveness, so we must actively respond to the current crisis faced by universities," adding, "To enable universities to lead the 4th Industrial Revolution and balanced regional development, and contribute to sustainable national development and competitiveness, financial support to compensate for past deficits is urgently needed."

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