Top 0.1% of Koreans make 1.8b won a year; 126 pay no tax

(123rf)

Government data showed Wednesday that the top 0.1 percent of earners in South Korea made an average of 1.8 billion won in 2022, and that 126 of them paid no tax due to various deductions and exemptions.

The combined income of a total of 26.2 million South Koreans came to 1.59 quadrillion won ($1.17 trillion) in 2022, while the combined income of the top 0.1 percent -- a group consisting of 26,231 individuals -- amounted to 47.1 trillion won, according to National Tax Service data submitted to Rep. Lim Gwang-hyeon of the main opposition Democratic Party of Korea. On average, the top 0.1 percent made 1.79 billion won while the average Korean made 40 million won.

According to the Income Tax Act, those earning over 1 billion won a year are subject to an income tax rate of 45 percent, but of the highest earners, 126 were effectively exempt from income tax for the year.

The report did not specify the backgrounds of the individual top earners who paid no tax.

"The overall taxable income of the highest earners is not low, but it appears that some in that bracket have benefited from substantial deductions and exemptions. (The government) needs to examine the proportionality of the tax exemptions and deductions taken by these high income earners, and review the law to ensure they are taxed fairly," Lim said.