Last Year, 8.65 Million Businesses Recorded, a Historic High... Entertainment Industry Struggled While Golf Courses Thrived

National Tax Service Publishes 143 National Tax Statistics via Portal
Number of New Businesses Surges in Real Estate Sector
Individual Consumption Tax Declarations Plummet in Entertainment Venues and Casinos, Rise in Golf Courses and Tobacco

[Sejong=Asia Economy Reporter Kim Hyunjung] Despite COVID-19, the number of operating individual and corporate businesses increased, reaching an all-time high. In particular, the number of new businesses in the real estate sector surged significantly. Due to the impact of social distancing measures, individual consumption tax declaration amounts for entertainment venues, casinos, and racetracks, which had faced operational disruptions, fell to less than half compared to the previous year, while declarations related to golf courses, tobacco, and passenger cars increased.

On the 29th, the National Tax Service (NTS) disclosed these national tax statistics for the second time this year, following the initial release in April. To enable the public to access related statistics more quickly, the NTS published 143 national tax statistics for the previous year on the National Tax Statistics Portal ahead of the 'National Tax Statistics Yearbook' scheduled for release in December.

According to the statistics released that day, as of the end of last year, the number of operating businesses stood at 8.65 million, marking a 7.5% increase from the previous year-end and reaching a record high. Operating businesses refer to those that have not closed and continue to operate, including both individual and corporate businesses.

Corporate businesses increased by 8.3%, while individual businesses rose by 7.4%. The number of new businesses was 1.519 million, up 15.4% from 1.316 million the previous year, and the number of closures was 895,000, down 2.9% from 922,000 the previous year.

Examining the number of new businesses by industry, real estate accounted for 439,000 (28.9%), retail trade 291,000 (19.2%), and restaurants 164,000 (10.8%). The year-over-year growth rates were highest in real estate (56.4%), retail trade (26.1%), and legal, accounting, architecture, and consulting services (22.5%).

The age group of business owners was predominantly between their 30s and 50s, comprising 72.1% of the total. The NTS explained, "The high number of new businesses among those aged 30 to 50 is consistent with the age-specific business opening rates relative to population size, indicating more active business startups compared to other age groups."

The proportion of female business owners among all businesses was 39.7%, showing a continuous increase each year. Notably, the percentage of female representatives among new corporate businesses rose steadily from 21.7% in 2016 to 26.7% last year.

Regarding the VAT taxable base for individual businesses by industry, retail trade was the largest at 160 trillion KRW, followed by wholesale trade at 157 trillion KRW, and manufacturing at 138 trillion KRW.

Looking at major tax items, the number of inheritance tax declarations last year was 11,521, with declared asset values totaling 27.4139 trillion KRW, representing increases of 20.6% and 27.3% respectively compared to the previous year. Among inheritance tax declarations, the segment with asset values under 2 billion KRW (over 1 billion KRW) accounted for the largest share with 5,126 people (44.5%) and asset values of 6.6369 trillion KRW (24.2%).

The number of gift tax declarations was 214,603, and the declared gift asset value was 43.6134 trillion KRW, up 41.7% and 54.4% respectively from the previous year. By asset type, buildings accounted for 71,691 cases and 19.8696 trillion KRW, surging 68.1% and 144.1% respectively year-over-year.

[Image source=Yonhap News]

The number of corporate tax filing corporations was 838,000, with a total tax burden of 53.5714 trillion KRW, of which 419,000 (50.1%) paid corporate tax. By industry, manufacturing bore 18.0493 trillion KRW (33.7%) and finance and insurance 11.3547 trillion KRW (21.2%). Corporate tax declarations from small and medium enterprises (SMEs) increased by 8.3% to 762,000 cases, while those from general corporations decreased by 9.3% to 76,000 cases. The tax burden for SMEs rose 1.8% to 13.1623 trillion KRW, whereas for general corporations it fell 25.6% to 40.4092 trillion KRW.

Additionally, securities transaction tax statistics showed a taxable base of 5,718 trillion KRW, up 141.9% from the previous year, and calculated tax amount of 951.48 billion KRW, up 111.6%. The total individual consumption tax declaration amount decreased slightly by 0.4% to 3.7189 trillion KRW. Tobacco-related declarations amounted to 1.9719 trillion KRW, an 8.3% increase from the previous year. Passenger car declarations rose 5.2% to 838.5 billion KRW. Membership golf courses increased 5.0% to 183.6 billion KRW, while entertainment bars declined 53.8% to 38.1 billion KRW.

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