Jo Incheol: "Plan to Expand Personal Deduction to 2 Million Won"
Representative Proposal of the "Income Tax Act Amendment"
Democratic Party lawmaker Cho Incheol (Gwangju Seogu-gap) announced on the 23rd that he has proposed the "Income Tax Act Amendment," which aims to update the income deduction criteria that have been frozen for 16 years.
The amendment was prepared to reduce the tax burden on citizens by reflecting rising prices and increased living costs. Under the current law, 1.5 million won is deducted per person, including the taxpayer and each dependent family member. However, the basic deduction amount has only been increased once since its establishment in 1994, in 2009, and has failed to keep pace with the sharp rise in inflation.
The amendment includes expanding the criteria and scope for the basic deduction. First, the basic deduction per person will be increased from the current 1.5 million won to 2 million won.
For example, if a taxpayer has four dependents, they will be able to receive up to 2 million won more in deductions compared to the current system. Additionally, while previously only dependents with an income of 1 million won or less (or 5 million won or less if they only have earned income) were eligible for deductions, the amendment will expand eligibility to those with an income of up to 2 million won (or 7 million won if they only have earned income).
Furthermore, the age limit for dependent family members will be raised from 20 to 24, allowing teenagers without income, such as those preparing for university entrance, to be included as deduction recipients.
If the amendment passes, it will take effect from January 1, 2026, and will apply to income tax filings and year-end tax settlements from then on.
Cho stated, "It is important to protect citizens' wages and increase their real income," adding, "This amendment is part of efforts to reduce the tax burden on the public and expand deduction benefits."
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