Suwon City Prepares Measures for Tax Revenue Shortfall Due to Economic Downturn

Suwon City Hall

The city of Suwon in Gyeonggi Province has launched efforts to secure tax revenue to overcome its financial crisis.

Suwon City anticipates a sharp decline in revenue next year due to a significant reduction in local allocation tax and adjustment grants amid the economic downturn, as well as a decrease in operating profits of Samsung Electronics located within the city.

Accordingly, on the 19th, Suwon Mayor Lee Jae-jun presided over a "Tax Revenue Securing Measures Meeting" to discuss plans to overcome the financial crisis, including a full review of the 2024 expenditure budget and measures to increase revenue.

Suwon City plans to enhance the efficiency of financial expenditures through strong structural adjustments in spending, while addressing the financial crisis in a way that does not inconvenience citizens in terms of revenue collection.

By implementing strong expenditure structural adjustments to improve the efficiency of financial spending, the city intends to utilize the Integrated Financial Stabilization Fund to cover any shortfalls.

Additionally, to resolve the issue of delayed payments caused by failure to receive tax bills, a mobile electronic delivery system using KakaoTalk AlimTalk notifications will be introduced next year.

Suwon City expects that this system will prevent delinquency in advance and increase collection rates, thereby boosting tax revenue while reducing the budget for postal delivery costs.

The city will also address the issue of collection grants, which do not reflect increased administrative processing costs due to changes in collection environment and scale.

Currently, Suwon receives collection grants from Gyeonggi Province calculated at 3% of provincial tax collections. However, as Suwon hosts a concentrated automobile sales complex, the nationwide vehicle registration system has increased workload and administrative costs related to vehicle registration.

To resolve this issue, Suwon plans to propose to Gyeonggi Province an improvement in the criteria for collection grants so that the number of collection cases, which serves as a basis for workload, can be reflected in the calculation of collection grants.

A Suwon city official stated, "We are turning the financial crisis into an opportunity to secure fiscal soundness and are making every effort to find solutions to secure tax revenue." He added, "There is also good news that Starfield Suwon will soon open in the city, which is expected to have a positive effect on revitalizing the local economy and increasing tax revenue."

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