Koo Yoonchul: "Comprehensive Review of Economic Criminal Penalties... 30% Including Breach of Trust to Be Improved Within One Year" (Summary)

Government Interpellation at the National Assembly...
"Final Decision on Highest Dividend Tax Rate After Listening to Opinions"
"We Will Prepare Guidelines Before the Implementation of the Yellow Envelope Act"

Deputy Prime Minister and Minister of Economy and Finance Koo Yoonchul is responding to a question from Kim Sanghoon, a member of the People Power Party, during a government-wide economic inquiry held at the National Assembly on September 17, 2025. Photo by Kim Hyunmin

Deputy Prime Minister and Minister of Economy and Finance Koo Yoonchul announced on the 17th, "We will comprehensively review more than 6,000 economic criminal penalties and improve 30% of them within one year."

Appearing at the government-wide economic inquiry held at the National Assembly that day, Deputy Prime Minister Koo addressed the need to rationalize economic criminal penalties, stating, "It is not appropriate for economic criminal penalties to excessively constrain companies or overregulate the public."

He added, "If a violation occurs due to good-faith mistakes without intentional or gross negligence, we will seek to allow corrective action whenever possible," emphasizing, "We must ensure that the investment sentiment of companies is not excessively dampened."

He continued, "We will review economic criminal penalties and submit an initial bill to the National Assembly in September," adding, "We aim to improve about 30% within a year, including offenses such as breach of trust."

The government previously established the 'Task Force for Rationalizing Economic Criminal Penalties,' comprised of the Ministry of Economy and Finance, the Ministry of Justice, and other relevant agencies, to discuss ways to ease economic criminal penalties that restrict corporate activities.

In response to questions regarding the government's proactive role, Deputy Prime Minister Koo said, "It is important to invest boldly where needed, but also to save where possible. We will invest decisively in growth engines such as research and development (R&D), while identifying and reducing wasteful elements such as those found in public sector reforms."

Regarding the question of whether inheritance and gift taxes should be eased to promote business succession, he replied, "We have expanded the inheritance deduction target to companies with annual sales of up to 500 billion won and increased the deduction limit to 60 billion won. However, there are also concerns about tax fairness."

He added, "We will carefully consider the difficulties faced by companies and issues of tax fairness, and listen closely to the voices of businesses. We will manage the system in a way that resolves these issues."

Deputy Prime Minister Koo also expressed his intention to prepare specific guidelines ahead of the enforcement of the Yellow Envelope Act. In response to concerns that the act may worsen the business environment, he said, "There is a six-month grace period before the law takes effect, and during this time, we will prepare guidelines as quickly as possible and provide explanations."

Regarding the maximum separate taxation rate for dividend income (35%), he stated, "We will listen further to the opinions of the National Assembly and the market before making a final decision."

Explaining the background of the tax rate decision, Deputy Prime Minister Koo said, "We set it at 35% to ensure fairness with labor and business income tax rates. We are considering both the need to encourage dividends and the importance of tax fairness." He added, "Although we have decided on 35%, we will make a prudent judgment after listening to the National Assembly and public opinion."

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