Democratic Party: "Next Year's Government Budget, Tax Cuts for the Rich, Neglect of Livelihoods, and Abandonment of the Future"

by Kong Byeongseon

Published 27 Aug.2024 14:54(KST)

The Democratic Party harshly criticized the 2025 government budget proposed by the Yoon Seok-yeol administration as a "budget of tax cuts for the wealthy, neglect of people's livelihoods, and abandonment of the future."

Jinseongjun, the Policy Committee Chairman of the Democratic Party of Korea, is speaking at the floor strategy meeting held at the National Assembly on the 25th. Photo by Hyunmin Kim kimhyun81@

On the 27th, Jin Sung-jun, Chairman of the Democratic Party Policy Committee, and Heo Young, Chairman of the Democratic Party Budget and Accounts Policy Coordination Committee, stated in a press release, "The Democratic Party evaluates the (next year's government budget) as a budget reflecting tax cuts for the wealthy, neglect of people's livelihoods, and abandonment of the future," adding, "The tax base has been undermined by tax cuts for the wealthy and reductions in levies, and budgets for livelihood projects recognized as necessary by the public have either not been reflected or have been reduced. Investment in future-oriented research and development (R&D) is only slightly above the level of two years ago."

The Democratic Party pointed out that the Yoon administration's tax cut policies lead to revenue shortfalls. The party said, "The budget reflects the undermining of the tax base due to tax cuts for the wealthy, such as the abolition of the financial investment income tax, reduction of inheritance tax rates, and elimination of various levies," and added, "An active role of fiscal policy is required, and stable fiscal revenue to support this is more important than ever."

They also harshly criticized the budget as being distant from people's livelihoods and safety. The Democratic Party stated, "The Yoon administration has not reflected any budget for local love gift certificates, which are recognized as necessary for countering high inflation and revitalizing domestic demand, and are requested as livelihood measures by both the public and small business owners and self-employed individuals," and added, "Although investment in disaster management, such as support for sprinkler installation following the Bucheon hotel fire tragedy, is important, the disaster safety budget for next year is 2.0067 trillion won, which is 266.1 billion won less than this year's 2.2728 trillion won."

They criticized the neglect of future growth industries and housing measures. The Democratic Party said, "The government emphasizes that the R&D budget for next year is 29.7 trillion won, the largest ever, but in reality, it is only a slight increase from last year's R&D budget of 29.3 trillion won," adding, "Looking at the government's budget for next year, which barely compensates for last year's policy failures, it is questionable whether the Yoon administration has a strong will to actively prepare for the future." Furthermore, they stated, "The government claims that the next year's budget will support the supply of a record 252,000 public housing units, but the public housing budget has actually decreased by more than 3 trillion won compared to this year," and added, "It is difficult to accept that investment is reduced by more than 3 trillion won due to improvements in execution methods."

Going forward, the Democratic Party is expected to engage in disputes over the government budget in the National Assembly. The party said, "The budget, which reveals the government's tax cuts for the wealthy, neglect of people's livelihoods, and abandonment of the future, will be responsibly amended during the National Assembly review process by the Democratic Party," and added, "We will ensure that next year's budget transforms into a national finance that gives hope to the people."

On the same day, the government held a Cabinet meeting in the morning and approved the next year's budget. Total revenue is set at 651.8 trillion won, an increase of 39.6 trillion won (6.5%), and total expenditure is set at 677.4 trillion won, an increase of 20.8 trillion won (3.2%). The budget will be submitted to the National Assembly early next month and finalized in December after reductions and increases are reviewed by each standing committee and the Budget and Accounts Special Committee.