Tax advisory body recommends fewer auditsA private-sector advisory body to the nation’s tax agency recommended the National Tax Service (NTS) minimize its audits of Korean businesses in the second half of the year, during a meeting Thursday with NTS President Lim Hwan-soo.
“In the first half of this year, tax collection has been favorable,” said University of Seoul President Won Yun-hi, who leads the 16-member committee that includes executives from companies, research institutes and lobby groups such as the Korea Chamber of Commerce and Industry. “But considering the recent difficult economic situation and fiscal demands in the future, the NTS should still remain alert.
“We ask that the NTS, in order to gain public trust, execute fair and cautious tax administration,” he said, “And to do this, auditing and follow-up inspection should be minimized to the absolute necessity in order to prevent additional burdens on the public.”
According to the NTS, a total of 121 trillion won ($109 billion) in taxes was collected in the first half, up 18.9 trillion won, or 18.5 percent, compared to a year ago largely thanks to higher corporate tax collection as well as increased consumer spending that led to more revenue from value-added taxes.
Economic factors in the second half, though, are likely to be less favorable, particularly with the shipping and shipbuilding industries undergoing restructuring.
The conditions might not only affect corporate tax collection but also lead to less spending in regions that are heavily dependent on the two industries, such as the southeastern cities of Geoje in South Gyeongsang and Ulsan.
The recent expiration of an individual consumption tax cut on automobile sales will also likely lead to lower value-added tax collection in the second half.
BY LEE HO-JEONG [email@example.com]