Tax revenue up 21 percent on year in first two months of 2022

50,000-won notes at Bank of Korea [YONHAP]

The central government collected 70 trillion won of taxes in the first two months of the year, 21 percent more than in the same period in 2021, according to the Finance Ministry on Thursday.

The tax take is 20 percent of the annual target for collections.

Strong exports and manufacturing growth were in part responsible for the revenue increase.

In the first two months of the year, the government collected a total of 30.4 trillion won of income tax, 27.7 percent more than in the same period in 2021, 4.1 trillion won in corporate tax, up 41 percent, and 19.8 trillion of value-added tax, up 22 percent.

Total government revenue — which includes social insurance contributions — was 106.1 trillion won, up 9.3 percent.

The social insurance contributions did drop on year, totaling 27.2 trillion won, down 12.8 percent.

In the first two months of the year, the government reported a deficit of 15.1 trillion won largely due to aggressive Covid-19 spending.

Total spending was 121.2 trillion won in the first two months, a 10.4 percent increase.

The report comes as President-elect Yoon Suk-yeol discusses a 50 trillion-won supplementary budget.

The government issued 18.5 trillion won of bonds in March.

The yield on 3-year Korean government bonds as of Wednesday was 3.1 percent, up from January's 2.2 percent, while the 10-year government bond was trading at 3.3 percent, up from 2.6 percent in January.

"Despite the difficult market conditions, we were able to issue 53.3 trillion won of bonds in the first three months of the year, which is 30 percent of the annual limit of 177.3 trillion won," said Ahn Do-geol, vice finance ministry.

BY LEE HO-JEONG [lee.hojeong@joongang.co.kr]