Ahn Dogeol: "Last Year, Salaried Workers Paid More Taxes Than Corporations"

For the First Time Since National Tax Statistics Began
Proportion of Earned Income Tax Exceeds Corporate Tax
"Tax Base and Fairness Must Be Restored"

Ando Geol, Member of the National Assembly.

Last year, the amount of earned income tax paid by salaried workers exceeded the total corporate tax paid by companies.

According to an analysis of the "2024 Tax Revenue Status by Tax Item" submitted by the National Tax Service to Representative Ahn Dogeol of the Democratic Party of Korea (Gwangju Dongnam-eul) on the 20th, despite a 30 trillion won tax revenue shortfall last year, the earned income tax paid by salaried workers increased by more than 2 trillion won, surpassing 64 trillion won.

In contrast, due to declining corporate business performance and the tax reduction policies of the Yoon Suk-yeol administration, corporate tax revenue sharply decreased for the second consecutive year, falling to 62.5 trillion won.

Last year, national tax revenue was 336.5 trillion won, a decrease of 59.4 trillion won (△15%) compared to two years ago (395.9 trillion won). During the same period, nominal GDP increased by 9.4%. As prices rise and the economy grows, tax revenue should increase proportionally, but large-scale tax cuts have undermined the tax base, according to the analysis.

The 2024 tax revenue target (418.8 trillion won) set in the medium-term fiscal plan established after the launch of the Yoon Suk-yeol administration was 82.3 trillion won higher than the actual figure. More than 80 trillion won in tax revenue disappeared in a single year. Including the 56.4 trillion won decrease compared to the 2023 tax revenue target, a total of 139 trillion won in tax revenue evaporated over two years.

The tax item with the largest decrease was corporate tax, which dropped from 104 trillion won in 2022 to 62.5 trillion won last year. This is a sharp decline of over 40 trillion won (△39.7%). The next largest decrease was in capital gains tax, which fell by 15.5 trillion won (△48%) compared to two years ago (32.2 trillion won). Just these two tax items?corporate tax and capital gains tax?accounted for a decrease of 63.1 trillion won, which is even larger than the total tax revenue decrease (△59.4 trillion won).

Meanwhile, the earned income tax paid by salaried workers continues to rise. The earned income tax, which is levied on employees' salaries, reached 64.2 trillion won, an increase of 3.8 trillion won (6.3%) compared to two years ago (60.4 trillion won). While corporate tax and capital gains tax decreased due to the economic downturn and the government's tax reduction policies, only the taxes paid by salaried workers?often referred to as having "glass wallets"?have increased.

This is the first time in history that earned income tax has surpassed corporate tax since national tax statistics began to be compiled.

Representative Ahn pointed out, "Due to the economic downturn and tax reduction policies, tax revenues such as corporate tax, capital gains tax, and comprehensive real estate holding tax have all shrunk, yet the taxes paid by salaried workers have increased," adding, "Those who truly need tax relief are not large corporations, but salaried workers."

Representative Ahn also emphasized, "The Yoon Suk-yeol administration's tax cuts for the wealthy have completely destroyed the tax revenue base and tax fairness, which are the foundations of the national budget," and stressed, "We must gradually normalize tax cuts for the wealthy to strengthen the tax base and restore tax fairness between corporations and households."

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