Lower taxes on golf, pleaseGolf is so widely enjoyed now that it can hardly be called a sport for the rich. Last year, local golf courses were visited by 28 million golfers, four times more than the number of people visiting baseball stadiums to watch professional baseball games. There are more virtual golf ranges around the country than billiard halls. All these numbers prove that golf is no longer exclusively enjoyed by a certain group of people.
However, the government’s perception on golf hasn’t changed in the last three decades. The number of golfers is growing, but the policy remains the same, and that means heavy taxes. Every time they play a round of golf, golfers have to pay 21,120 won ($19.49) in taxes, including 12,000 won for an individual consumption tax, 3,600 won in education tax, 3,600 won in a special tax for rural development and 1,900 won in value-added tax. Other than the “special consumption tax” changing to an “individual consumption tax,” the taxes on golfers are not much different from 30 years ago.
The government’s reason for imposing heavy taxes on the golfers is administrative expediency. It assumes golfers must be rich and can pay higher taxes. But unlike soccer or baseball, golf is more of an industry than sports or leisure. Golf club makers are part of the manufacturing industry, and golf outfit and hat makers are from the fashion industry. Golf instruction belongs to the education industry, and building golf courses is the construction industry. The broadcast industry televises golf games and sells air rights, and golf tour packages boost the travel industry.
In other words, golf is an industry that combines manufacturing, fashion, education, construction, broadcasting and travel businesses. Annually, revenues created by golf come to the hundreds of billions of dollars. In the United States, golf is one of the country’s top 10 industries.
The excessive taxes on golf should be drastically reduced. Last year, one country club in Gyeonggi Province paid 4.5 billion won in taxes, including 3.3 billion won in property tax and 1.2 billion won in individual consumption tax. It had to pay 36 percent of its revenue as taxes. If the property tax and individual consumption tax were lowered, the country club could afford a considerable reduction of green fees.
The average fee for a round of golf during the weekend in the capital region is 220,000 won. Other regions charge 180,000 won, and you can play a round for 140,000 won in Jeju Island. However, clubs in Japan charge about 100,000 won, and a round can be enjoyed for 40,000 to 50,000 won in China, Thailand and the Philippines. Since it is much cheaper to play golf in nearby countries, many people travel abroad to enjoy golf.
If the tax imposed on each round of golf is lowered, green fees will be lowered and more people can play. Not only would golfers play in Korea instead of traveling abroad, but foreign tourists could also come here to play. This, combined with the growing number of world-class golf professionals from Korea, could help promote Korea as a golf power.
Starting in 2016, golf will become an official Olympic sport. With the designation, surely golf-related industries will only thrive. Building golf courses and giving golf lessons in China should not be monopolized by Britain or America.
I would like to make a bold proposal, to make golf into one of the top 10 industries of Korea. We could export golf clubs labeled “Made in Korea” and Korean architects could design golf courses in the United States and China. There are more than 500 golf courses around the country. Unless the government wants to get rid of golf courses altogether, it is better to considerably lower the taxes imposed on golf and boost the golf industry. That would add jobs and attract foreign tourists. Golf can be the next leading industry of Korea like the smartphone.
Translation by the Korea JoongAng Daily staff.
*The author is policy advisor for the Korea Golf Course Business Association.
by Choi Moon-hyu