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Tax revenue falls 11.3 trillion won through Sept. on weak corporate earnings

Published: 31 Oct. 2024, 15:20 Updated: 31 Oct. 2024, 15:20

SHIN HA-NEE
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The headquarters of the Ministry of Economy and Finance in Sejong [MINISTRY OF ECONOMY AND FINANCE]

Korea's tax revenue fell 11.3 trillion won ($8.19 billion) from a year earlier during the first nine months of 2024 due mainly to weak corporate earnings, data showed Thursday.

The government collected 255.3 trillion won of taxes over the January-September period, down 4.3 percent from 266.6 trillion won logged during the same period last year, according to data from the Ministry of Economy and Finance.

The decline was led by falling corporate tax collection, which dipped 24.2 percent, or 17.4 trillion won, to 54.5 trillion as local businesses suffered weak earnings last year.

Operating profits of companies listed on the main bourse dipped 45 percent on-year in 2023. Those of firms listed on the tech-heavy Kosdaq market also tumbled 39.8 percent, according to government data.

The amount of income tax collected inched up 0.5 percent over the cited period to 85 trillion won.

Value-added tax amounted to 60.5 trillion won in the January-September period, marking a 10.3 percent increase from a year earlier on rising consumption.

But tax collection from securities transactions sank 19.7 percent to 3.9 trillion won amid a bearish domestic stock market situation, according to the ministry.

In September alone, the country's total tax revenue slid 7.7 percent on-year to 23.1 trillion won.

Korea is projected to suffer a massive tax revenue shortfall for the second consecutive year.

The government is expected to collect 337.7 trillion won in taxes this year, an 8.1 percent or 29.6 trillion won fall from its forecast made in the 2024 budget planning.

The revised amount was also 6.4 trillion won smaller than the tax revenue of 344.1 trillion won last year, when the country suffered a record shortfall of 56.4 trillion won.

Yonhap