A group of business leaders on Wednesday expressed strong opposition to tax increases for welfare expansion, claiming that it will hurt corporate capital spending and household consumption.

The remarks came amid growing calls for “economic democratization” including an overhaul of local conglomerates’ governance structures and an expansion of the welfare system by the country’s three main presidential candidates.

“Corporate taxes and income taxes should not be raised to secure finances in order to expand the welfare system,” 71 heads of local chapters of the Korean Chamber of Commerce and Industry said in a statement released after a meeting held in Changwon, 398 kilometers south of Seoul.

They warned that the tax increases will dampen corporate capital spending and private consumption, placing a burden on the ailing local economy.

Welfare expansion and the reform of chaebol, or South Korea’s family-run conglomerates which monopolize economic benefits, have emerged as a key campaign issue ahead of the December presidential election, as presidential hopefuls try to tap into the public’s sentiment against conglomerates. (Yonhap News)