Customs revenue likely to double next year
The estimated revenue of Korea’s customs authorities is projected to more than double next year due to a surge in licensing fees for duty free shops, a report said Monday.
According to the report by the National Assembly and related government agencies, the Korea Customs Service’s estimated revenue stands at 97.8 billion won ($87.3 million) for 2018, up 118 percent from this year’s 44.7 billion won. The estimate includes fines, forfeits, additional charges and other income.
The main reason for the sharp rise is an up-to-20-fold increase in the licensing fees for duty free stores, which account for 60.5 billion won, or 61 percent of the total.
Last year, the government revised a related law to jack up the fee, which had been under fire for being too low and giving big favors to operators.
Coveted by large companies, local duty free shops had been called the goose that lays the golden egg before they took a big hit from a diplomatic row between Korea and China over the deployment of an advanced U.S. missile shield here this year.
The government periodically selects duty free operators after a close scrutiny of aspirants and has pledged to overhaul the selection system to root out any wrongdoing following irregularities during the government of ousted President Park Geun-hye.
The sharp increase in licensing fees is said to have helped eliminate room for excessive favors but has come as a double whammy to duty free shop operators hit hard by the tumble in the number of Chinese tourists.
The missile defense row has dealt a harsh blow to local duty free shops and department stores, as Chinese tourists were their key customers.