Former Finance Minister Kang Mansu: "Tax Cuts Are Better Than 250,000 Won Support"

Former Minister of Strategy and Finance under MB Era
Hosts Book Concert at Sejong Convention Center
Not a Key Currency Country... Emphasizes Exchange Rate Policy

"It is definitely better to cut taxes than to distribute 250,000 won."

Former Minister of Strategy and Finance Kang Man-soo said this on the 19th at the 'Challenges of the Korean Economy Seen from the Field' book concert held at the Sejong Convention Center. He expressed opposition to the recent opposition party's plan to provide 250,000 won in livelihood recovery support funds to all citizens.

Former Minister of Strategy and Finance Kang Man-soo speaking at the book concert "Challenges of the Korean Economy Seen from the Field" held at the Sejong Convention Center on the 19th / Photo by Kim Pyeong-hwa

Former Minister Kang said, "There is a (Harvard University) report analyzing about 90 economic stimulus measures since the 1970s, which shows that tax cut policies were all successful while spending policies mostly failed," emphasizing the effectiveness of tax cut policies. Although various tax cut policies have been criticized as tax cuts for the wealthy, his explanation is that it is correct to interpret them as 'tax reduction policies for tax increase.'

Former Minister Kang presented statistics he directly calculated as evidence for this claim. According to the trends of 'income tax rates, corporate tax rates, and tax revenue proportions' included in his book, from 1975 to 2012, while domestic income tax rates and corporate tax rates gradually decreased, the proportion of income tax and corporate tax relative to Gross Domestic Product (GDP) showed an upward curve. He reiterated, "Lowering tax rates is a tax increase policy, not a tax cut," emphasizing his point again.

Former Minister Kang also argued for the necessity of abolishing the comprehensive real estate tax and inheritance tax. Following the same argument made at a book concert held in Seoul on the 13th, he emphasized the necessity again on this day. At the event, he strongly criticized, "The comprehensive real estate tax is political violence disguised as a tax," and said, "It is a tax that has never existed in human history and should never have been born."

He also stressed the importance of exchange rates, saying that the foundation on which the dollar-issuing key currency country (the United States) and neighboring countries (Korea) stand is different. Regarding the high exchange rate policy he promoted during his tenure as Minister of Strategy and Finance in 2008, he explained that it was an unavoidable strategy during the global financial crisis and described it as "the actualization of the exchange rate." He also stated that instead of directly applying American economic theories domestically, economic policies suited to Korea's export-oriented characteristics should be considered.

Former Minister Kang is a senior economic official and a living textbook of the Korean economy. He served as Vice Minister of Finance and Economy during the 1997 Asian financial crisis and as Minister of Strategy and Finance during the 2008 global financial crisis, acting as a troubleshooter in times of crisis. He was also a key figure at the center of designing MBnomics (the economic policy of the Lee Myung-bak administration). Recently, he published a new book compiling his previous memoirs titled 'Challenges of the Korean Economy Seen from the Field.'

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