The Ministry of Strategy and Finance said Tuesday that it would raise the baseline income dividing the top and mid to low income earners from 34.5 million won to 55 million won as part of its tax code revision.This would significantly decrease the number of workers facing tax burdens from the government’s earlier proposal to about 2 million, from more than 4.3 million people, who were categorized in the top 28 percent bracket.Those with an annual salary of more than 55 million won will face tax

Political strife and public criticism escalated on Monday over the latest tax code revision proposal, with calls mounting for Deputy Prime Minister and Finance Minister Hyun Oh-seok and senior presidential economic adviser Cho Won-dong to take “full responsibility” for the revision.Backlash has built up since last week, and President Park Geun-hye ordered her senior advisers and policymakers to redraw the administration’s tax revision from scratch so that it would benefit low- and middle-income

The government plans to increase Korea’s tax burden in proportion to its national output from 20.2 percent to 21 percent over the next four years. This is part of efforts to service growing welfare costs in the long-run at the expense of increasing taxes on average workers.Its recent proposal to replace income tax deductions with tax credits and raise tax rates for the top 20 percent of earners resembles the path European nations took in creating welfare states.

The nation’s No. 2 airliner, Asiana Airlines, on said Sunday it plans to offer $10,000 in compensation to all passengers who were aboard the Boeing 777 plane that crashed in San Francisco last month.“The compensation is a minimum payment to cover medical expenses and inconveniences,” Asiana official said. They added that passengers may still file lawsuits after accepting the compensation, including those who were not injured. The air carrier’s move came as its plane, carrying 291 passengers and

South Korea’s Incheon International Airport Corp. said Sunday that it has been picked as the preferred bidder for the development of a new international airport in Myanmar.The company, which operates the country’s largest airport, said it will hold detailed negotiations with authorities from Myanmar on the size of the new airport and other matters related to costs and operations, with the final agreement to be reached by the year’s end.Once an agreement is reached, the goal will be to open Hanth

Korean stocks will continue to face choppy trading in the coming weeks as there are no clear and positive signs to support market liquidity and investor confidence, analysts said.External macroeconomic factors such as the tapering of the U.S. quantitative easing and China’s slowdown would be a test for the Korean equity market on whether the benchmark could rise above the 1,900 threshold.With Korea being highly susceptible to external conditions due to its reliance on exports, it is also unclear

Bank of Korea Gov. Kim Choong-soo said Thursday that Korea might need to brace for rising inflationary pressure toward the latter half of this year as consumer prices were expected to climb further following the rainy season.The BOK chief added that the financial markets would continue to face periodic volatility until the U.S. Federal Reserve completely unwound its quantitative easing as its job market improved in 2014.Kim’s cautionary note came after the central bank’s monetary policy committe

Confidence that the Korean economy will gain ground in the second half of this year is growing on the back of a rosier outlook for the global economy.Economic indices showing solid rebounds in production in the U.S., China and the eurozone, Korea’s three biggest trading partners, are fueling projections that Korea could regain a growth rate of 4 percent.U.S. manufacturing activity measured by the Institute of Supply Management hit a record of above 50, improving employment in the sector in July.

The Bank of Korea’s monetary policy committee warned of increasing risks associated with one particular foreign asset manager holding a “big pot” of Korean fixed-income securities.They said that the central bank and financial regulators should keep an eye on such an “excessive bond ownership” by the foreign company to preemptively counter volatility following an expected tapering of U.S. quantitative easing, according to the minutes of its July policy meeting.An exit from U.S. monetary stimulus

Deputy Prime Minister and Finance Minister Hyun Oh-seok said that the government would focus on boosting private investment and productivity in the services industry by helping them ease future business uncertainties.The incumbent administration focused on devising policies and refining regulations in the first half of this year to promote fair market competition, or economic democratization.During his two-day trip to provincial areas, Hyun told reporters that it was time to concentrate on “elim

The government is seeking to rewrite the tax code to ease the burden on low-income groups and increase wealth distribution, according to government officials.The incumbent administration’s economic officials are in last-minute coordination with political circles in reshaping the taxation system to be both “fair and efficient,” they said. The ruling camp plans to finalize the changes in August.The government is also reportedly in talks with religious leaders, such as priests and Buddhist monks, t

Korea maintained a current account surplus for 17 straight months in June, and hit a record high for the first half of this year, the Bank of Korea reported on Tuesday.The current account, the broadest measure of trade, recorded a surplus of $7.24 billion in June.Although June’s surplus was less than the $8.64 billion from the previous month, Korea managed to maintain a positive streak thanks to brisk exports of IT and electronic products.Exports to Korea’s top trading partners such as China, th

Korea’s state-owned enterprises plan to increase investments of about 510 billion won ($458.5 million) for infrastructure and energy development projects in the second half of this year, the government said Tuesday.The 14 public enterprises are budgeted to spend 53.4 trillion won this year, including 1 trillion won allocated from supplementary spending.Public enterprises invested about 40 percent of the 1 trillion won in the first half of this year.The increase in public investment comes as the

Korea’s antitrust agency slapped fines on the six biggest domestic and foreign commercial vehicle makers and a distributor for price fixing, and ordered them to correct their wrongdoings against customers including licensed truck drivers.The Fair Trade Commission said Monday that it would impose penalties totaling 116 billion won ($104.5 million) for their deliberate collusion and was planning to file a complaint with the state prosecutor.The seven big commercial vehicle companies are: Hyundai M

The Ministry of Strategy and Finance said that it would lower taxes on transactions between parent companies and their subsidiaries or affiliates in a bid to improve business sentiment in the second half of this year.Also, the Finance Ministry is moving to extend the tax deduction benefits on credit card spending by workers on average salaries until next year to subdue the contention following the government’s plan to end such a deductible system.In a meeting with corporate executive members of

The Bank of Korea and the Ministry of Strategy and Finance may have to readjust their inflation forecast for the second half of this year and next year as they did for growth projections amid increasing inflationary pressure, industry sources said.Korea is expected to see double-digit increases in public transportation, electric utility and taxi fees, according to data from the central bank, Statistics Korea and private consumer reports.Such rising prices, on the back of increasing oil prices, c

Deputy Prime Minister and Finance Minister Hyun Oh-seok urged economy-related ministers to increase their monitoring of the financial markets to counter negative external factors.In a meeting with the ministers on Thursday, Hyun said the eurozone recession and China’s slow growth, below the 8 percent threshold, could dampen Korea’s recovery efforts in the second half of this year.The deputy prime minister had previously mentioned that the government would counter volatility through “proactive” m

The dispute between S.M. Entertainment and K-pop idol group JYJ has come to an end as Korea’s antitrust agency ordered S.M. Entertainment to correct and undo its wrongdoings against the three-member boy band.The Fair Trade Commission said Wednesday that it sanctioned S.M., one of the top three talent agencies in Korea, for its attempts to block JYJ from appearing on music television shows and distributing their albums over the years.S.M., in collusion with the Union of Korean Pop Culture and Art

Deputy Prime Minister and Finance Minister Hyun Oh-seok said Wednesday that the government will aim to speed up the recovery of the housing market as a means to improve the overall economy.In a meeting with economic-related ministers, Hyun said that it will control the supply side of the housing market especially in the Seoul metropolitan areas, in addition to tax cuts, to spur demand and thus transactions.However, it will continue to moderately provide public housing for the low- and mid-income

Conflict is brewing between the central and regional governments over tax cuts on real estate transactions being pushed by President Park Geun-hye to revive the housing market.The central government announced that it would indefinitely cut the property acquisition tax rate in accordance with apartment prices, despite growing opposition by regional offices amid increasing welfare costs and revenue shortfalls.Given that the purchase tax accounts for a significant share of regional income at over 3