Spending overseas to be watched
Any overseas credit or debit card spending that exceeds $10,000 a year will be reported to the National Tax Service and the Korea Customs Service.
Previously, spending was reported to the tax agency and customs office when it exceeded $20,000 and $50,000 each, respectively.
Remittances of more than $10,000 a year will also be reported to the tax agency. This includes spending on overseas tuitions. Currently such remittances are reported when they exceeded $50,000.
The Ministry of Strategy and Finance said the new regulations target possible tax evasion and strengthen information on foreign currency exchanges. They will go into effect starting April 30.
According to the Bank of Korea last year, Koreans’ credit card spending abroad in 2011 reached a new record of $8.6 billion, a nearly 19 percent increase from 2010.
In addition, local brokerages will be allowed to handle foreign exchange derivatives based on raw materials and other commodities from later this month without reporting to relevant government authorities.
Securities firms will also be permitted from April 30 to deal with foreign exchange derivatives based on ocean freight charges, weather, and other natural conditions after filing with the Bank of Korea, the ministry said in a statement.
By Lee Ho-jeong, Yonhap [email@example.com]
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