January National Tax Revenue Up 3 Trillion Won YoY... "No Large-Scale Tax Shortfall Expected"

National tax revenue in the first month of this year increased by 3 trillion won compared to the same period last year. The government emphasized that it will not repeat last year's record-high tax revenue shortfall this year.

The Ministry of Economy and Finance announced on the 29th that national tax revenue in January amounted to 45.9 trillion won, an increase of 3 trillion won (7.1%) compared to the same month last year.

This is partly due to the base effect from the sharp decline in national tax revenue in January last year (42.9 trillion won). Although tax revenue increased, it still falls short of January 2022 (49.7 trillion won). Yoon Su-hyun, head of the Tax Analysis Division at the Ministry of Economy and Finance, explained, "There was also an impact from the surge in tax revenue in January 2022," adding, "Looking at the trend over the past five years, there is an overall upward trend."

By category, the increase in value-added tax revenue by 2.3 trillion won (11.2%) due to increased consumption at the end of last year led the overall growth. Private consumption in the fourth quarter of last year rose by 1.0% compared to the same period the previous year.

Income tax also increased by 600 billion won (4.7%) due to a rise in the number of employed persons and interest rate hikes. Securities transaction tax increased by 100 billion won (24.6%) as trading volumes on KOSDAQ and KOSPI surged amid a stock market boom. Inheritance and gift taxes also rose by 200 billion won (29.1%).

Corporate tax decreased by 200 billion won (-7.9%) due to an increase in refunds to corporations with fiscal year-end in September last year. The Ministry of Economy and Finance explained that this is a temporary trend. Yoon said, "We expect annual corporate tax revenue to decrease by 3.4% this year, and although January alone saw a 7.9% decrease, which is significant, it is temporary," adding, "January corporate tax accounts for a small portion compared to the annual corporate tax, so it will not have a major impact on overall corporate tax revenue."

The tax revenue progress rate recorded 12.5%. Last year, a 'tax revenue shortfall' occurred with tax revenue collected falling short by more than 56 trillion won compared to estimates, but the Ministry of Economy and Finance expects that such a situation will not happen this year. Yoon stated, "Looking at January's performance alone, tax revenue is coming in favorably," adding, "We need to observe the trends of corporate tax in March and comprehensive income tax in May for an accurate forecast, but at the current level, we do not expect a large-scale tax revenue shortage like before."

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