"Accepted 1%p Corporate Tax Cut on a Grand Scale"...Democrats Accept Speaker's Mediation Proposal (Update)

Lee Jae-myung "Decided This Way Considering Difficult Livelihood Situation"
Accepts 1%p Reduction in Corporate Tax Top Rate
Tax Cut Plan for Low-Income Still Valid
Democratic Party Official "If Ruling Party Rejects Mediation Plan, Will Pass Solo Bill"

[Image source=Yonhap News]

[Asia Economy reporters Naju-seok and Park Jun-i] The Democratic Party of Korea announced on the 15th that it will accept the mediation proposal by National Assembly Speaker Kim Jin-pyo, which includes lowering the top corporate tax rate and executing the budget for agencies established by enforcement ordinances from contingency funds. This marks a step back from their previous stance opposing the reduction of the top corporate tax rate, which they called a "super-rich tax cut."

Democratic Party leader Lee Jae-myung explained at a press conference at the National Assembly that "After much deliberation, the Democratic Party has decided to respect the Speaker's intention and accept the mediation proposal from a magnanimous perspective," adding, "Although the Speaker's mediation proposal does not fully align with the Democratic Party's position, we say this considering the difficult livelihood situation."

Earlier, Speaker Kim Jin-pyo proposed a mediation plan during a meeting with ruling and opposition floor leaders in the morning regarding the sharply divided positions on the corporate tax and budget issues for agencies established by enforcement ordinances. The mediation plan includes lowering the top corporate tax rate by 1 percentage point and executing the budgets for the Ministry of the Interior and Safety’s Police Bureau and the Ministry of Justice’s Personnel Information Management Unit?both established by enforcement ordinances?through contingency funds until a separate budget is allocated or a decision is made by a competent authority with bipartisan agreement.

Lee said, "The livelihood economy is truly difficult," and added, "We must unite our society's full strength to overcome the crisis. We cannot continue to neglect the irresponsible situation of leaving the budget bill unprocessed."

Regarding the shift from fundamentally opposing the reduction of the top corporate tax rate, Lee explained, "Although tax cuts for ultra-high earners and the super-rich do not help due to the economic situation and worsen government finances, and thus do not aid livelihoods, the difference in positions between the government, ruling party, and the Democratic Party has stalled progress, which is undesirable," adding, "Even if political judgments differ, from a magnanimous perspective, we had no choice but to exercise pragmatic realism." He further said, "It is similar to a situation where a real mother must let go when a child's arm is being pulled from both sides by the real mother and a fake mother."

The Democratic Party explained that along with lowering the top corporate tax rate, the national tax cut for companies with operating profits between 200 million and 500 million won is also valid. Democratic Party floor leader Park Hong-geun stated, "The Speaker’s mediation proposal is a so-called comprehensive settlement, and the 3 trillion won national tax cut remains valid."

Since the Democratic Party has agreed on the budget bill, it also demanded the commencement of a state audit on the Itaewon disaster. Lee said, "Tomorrow marks the 49th memorial of the Itaewon disaster. We must no longer ignore the desperate cries of the bereaved families calling for an unreserved investigation," adding, "The National Assembly must immediately start the state audit to uncover the truth, punish those responsible, and establish measures to prevent recurrence."

He also indicated that if the government and ruling party do not accept the Speaker’s acceptance plan, they may process a unilateral amendment. A Democratic Party official said, "If the government and ruling party do not accept the mediation proposal, the Democratic Party can always bring out a unilateral amendment."

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