Namhae-gun Resolves Chronic Financial Shortage... Ordinary Local Allocation Tax Increased by 33.8 Billion Won

Jang Chung-nam County Governor's Persistent Efforts Over 5 Years Bear Fruit

Namhae-gun, Gyeongnam Province, has finally seen the fruits of its long-standing efforts to improve the calculation system for local allocation tax grants, resulting in an increase of 33.8 billion KRW in the general local allocation tax starting this year.

A view of Namhae County Office.

Moreover, unlike special local allocation tax grants which are one-time, the general local allocation tax is an annually supported revenue source, making this a significant boon for Namhae-gun, which has long suffered from chronic financial shortages due to ‘relative disadvantages.’

Namhae-gun had been at a considerable disadvantage compared to other local governments in the calculation of the general local allocation tax due to its geographic peculiarity as a connected island area, which resulted in a high population density. Previously, a high population density meant that the demand for adjustment as an underdeveloped area was not recognized when calculating the allocation tax.

County Governor Jang Chung-nam has persistently persuaded central government ministries and the National Assembly to relax or grant special exceptions to the population density criteria for connected island areas in order to improve this situation.

After five years of arduous efforts, the population density criteria for connected island areas were rationally revised as proposed by Namhae-gun during the amendment of the Enforcement Rules of the Local Allocation Tax Act at the end of last year.

With Namhae-gun’s proposal accepted, financial demand estimated at around 15 billion KRW was reflected. This fulfilled Namhae-gun’s long-standing wish.

In addition, with the establishment of new fisheries demand to respond to fishing damages caused by climate change, Namhae-gun’s total general local allocation tax will increase by 33.8 billion KRW starting this year.

Although the government reduced the general local allocation tax distributed to local governments nationwide by about 10% to respond to the expected economic downturn this year, Namhae-gun was able to secure financial demand in areas where it had been relatively disadvantaged compared to other local governments all at once, enabling a more stable fiscal policy.

Namhae-gun plans to prioritize investing the increased allocation tax resources into revitalizing the local economy and to focus intensive investment on expanding major infrastructure, which had been difficult with limited self-generated revenue.

Governor Jang said, “An 8% increase in the general local allocation tax starting this year is like a rain in a drought under tight fiscal conditions,” adding, “Having achieved great results by gaining the central government’s sympathy through continuous efforts, we will leverage this experience in securing national funds in various fields going forward.”

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