• Journal of Convergence for Information Technology
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• v.10 no.1
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• pp.75-81
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• 2020

This study analyzed the annual difference of firm's book income, taxable income and BTD that before and after the 2009 corporate tax rate cut and 2018 corporate tax rate increase. ANOVA analysis was performed for each item by year, and post hoc was performed after homogeneity test of variance. The research results are as follows. First, the book income at corporate tax rate cut was higher than taxable income, and BTD in 2008 was significantly different from other years. Second, the book income at corporate tax rate increase was less than taxable income, and BTD in 2017 was also significantly different from other years. In other words, the firm is performing appropriate profit adjustments to reduce of tax burden when the corporate tax rate changes. Because of this, the BTD in the year immediately before the corporate tax rate change is different from other years.

• KDI Journal of Economic Policy
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• v.31 no.1
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• pp.207-237
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• 2009

One of the main problems in Korea's public assistance program, the NBLS (National Basic Livelihood Security), is that the loophole of welfare system is continuously growing. Living wage program is the largest sub-program of the NBLS, and the most important determinant of amount of living wage for each beneficiary is the level of reported income. Therefore, accurate and effective income detection is essential in improving policy effects and furthermore reducing the leakage of wage expenditure as beneficiaries always have an incentive to underreport their income. Since most of them do not pay income tax, the welfare authority should exert an independent effort to effectively detect their income. Considering that living wage is a special kind of income tax of which marginal tax rate is -1, one can apply a classical theory of tax evasion to understand illegal or excessive receipt of living wage caused by income underreporting. Utilizing a classical theory given by Alingham and Sandmo (1972), this paper provides a theoretical analysis of the optimal income reporting of the beneficiary. Then an optimization problem is constructed from the government's viewpoint to derive optimal income detecting device (auditing). This paper proves that cut-off discriminated auditing outperforms random auditing and cut-off auditing which implies if the government assigns a positive audit probability to every reported income less than a certain level and the probability is inversely proportional to the level of reported income, it can minimize underreporting and then gradually reduce the leakage of wage expenditure.

• Asia-Pacific Journal of Business
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• v.14 no.1
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• pp.351-364
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• 2023

Purpose - This study examines the effects of Dubai oil price and the volatility on the asymmetry of domestic gasoline price adjustment. Additionally, the study investigates the effects of "Altteul" gas-station and tax-cut policies on asymmetry. Design/methodology/approach - Firstly, the study calculates proxies for asymmetry and volatility of each window(every 3-month) by error-correction model and GARCH(1, 1) using daily domestic gas price and Dubai oil price from 2008/04/15 to 2022/12/31. Secondly, the study investigates the effects of the increasing rate of Dubai oil price, volatility, "Altteul" gas-station and tax-cut policies on asymmetry. The autoregressive distributed lag regression model is employed for estimations. Findings - The study finds that changes in the increasing rate of Dubai oil price and both types of volatility of Dubai oil price increase asymmetry. While "Altteul" gas-station and tax-cut policies decrease asymmetry. Additionally, the study fails to find that asymmetry in the Korean gasoline market in the estimation with total observations. Research implications or Originality - An increase in Dubai oil price volatility means an increase in cost uncertainty for gas-station owners. Since cost uncertainty is a kind of financial risk, the increase in volatility reinforces the asymmetry. The study provides supporting evidence for the idea.

• Korea Trade Review
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• v.43 no.6
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• pp.215-238
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• 2018

Tariff reduction from FTAs are applied to imported goods, but not to traveler's goods. There are difficulties in meeting the FTA's conditions for free tariff application, such as origin of goods and direct transportation. This study suggests the optimal cut-off level of a simple tax rate applied to traveler's goods with respect to traveler' welfare and government tax revenue. Among three different scenarios of simple tax reductions by ordering its weighted magnitude of effects, the optimal tariff was found to be 2% applied to all goods. The effects of a 2% reduction of simple tax rate would increase traveler' welfare by 16.8 billion won and reduce tax revenue by only 0.34 billion won.

• The Journal of Asian Finance, Economics and Business
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• v.7 no.6
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• pp.145-155
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• 2020

This study analyzes the degree of competition in the oil refinery market in Korea, which is considered an oligopoly market. The price of gasoline and diesel and the quantity of supply are used to identify the market competition. We also analyze whether the oil tax reduction policy has affected market competition. The competitiveness of the market was examined using monthly data from 2008 to 2019. Bresnahan-Lau method was employed to estimate the degree of competition in the oil refinery market, which is frequently used in the industrial studies. The analysis shows that the gasoline and diesel markets seem close to a perfect competitive market. Also, the tax cut has weakened market competition. In other words, the monopolistic power has increased in the market, so consumers have not benefit from the price cuts as much as tax cuts. Although the oil refinery market where four major companies are competing, the government's monitoring and price disclosure system help the market to be highly competitive as much as a perfect competition market. The tax cut, in the high oil price era, has a negative effect on the competition because of an information asymmetry about the price-setting process between suppliers and consumers.

• Korean Business Review
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• v.14
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• pp.1-30
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• 2001

To prevent the VAT evasion and to form a sound VAT paying culture, we can draw the policy directions for government as follows: First, it is necessary to strengthen the tax supervision of small business and the administration of tax sources of cash-income industry. Second, the tax-deductible rate of the received tax invoices should be increased in a short-term base, and a simplified taxation system should be abolished in a long-term base. Third, in cases a trader has not received a tax invoice, an additional tax should be applied. Forth, to issue the tax invoice faster and conveniently, it is requested to introduce a new system which issues electronic card of registration when a businessman applies for his/her business registration. Fifth, to make tax standard transparent, it is desirable to punish the violator, relating to credit card regulations, stricter than present and to enforce the electronic bookkeeping. Sixth, for the reduction of noncompliance rate and creating a climate for autonomous, faithful tax return, it is necessary to expand and intensify tax investigation. And also it is necessary to make the level of penalty tax higher up and the level of criminal punishment less down, to keep up tax audit coverage. Seventh, a trader who is eligible for simplified taxation, whose tax base is under 12,000 thousand won, should not be required to pay the value added tax. But it is desirable to cut down them for the fairness of tax burden. Eighth, the effective date of the revised tax law should be fixed. Ninth, it is necessary to reinforce publicity and to educate on tax system and administration, for reducing tax evasion or tax avoidance and encouraging faithful tax return. Tenth, as the tendency of VAT evasion of distribution industry turns out to be the highest, it is requested not only to intensify tax administration on them but also to establish system and incentives, for introducing information system in distribution industry(introducing POS system, computerization of transaction record, establishing EDI between traders).

• Journal of the Korea Institute of Building Construction
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• v.22 no.1
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• pp.81-90
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• 2022

With apartment purchase prices rising, small and medium-sized cities have been highlighted as areas in which real estate speculation is overheated, and thus designated as target districts for adjustment. In addition, tax policy is constantly being adjusted in an attempt to stabilize real estate prices. The purpose of this study is to analyze the basic effect of tax policy on the purchase price of apartments in small and medium-sized cities. This study selected apartments in the Daejeon area that were constructed between 1990 and 2015. In addition, tax policy was divided into regulatory policy and easing policy based on tax increase and tax cut. This study analyzes the short-term difference of one year before and after the change in the purchase price of apartment houses. In addition, this study set the time when real estate policy was implemented and the actual transaction price of apartments in Daejeon as the analysis targets, and analyzed the correlation between tax policy and apartment sales prices through the NPV technique and T-test results. Through the study, it was found that most tax policies changed apartment purchase prices in the short term.

• KDI Journal of Economic Policy
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• v.34 no.4
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• pp.27-68
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• 2012

This study outlines measures related to fiscal policies aimed at responding to the financial crisis according to the timing of commencement and then examines impacts of expansionary fiscal policies on macro variables so as to extract policy implications. The size of expansionary fiscal policy to respond to the financial crisis is found to total 59.8 trillion won (6.1% of GDP in 2007), among which a total of 30.5 trillion won was the increased fiscal expenditure made by the 2008 supplementary budget, the 2009 revised budget and the 2009 supplementary budget. In addition, tax reductions are found to be a total of 29.3 trillion won, mainly driven by the tax reforms in 2008 and 2009. Examining dynamic changes in macro variables caused by the temporary increase in fiscal expenditure and the tax reductions reveals that the increase effect of the real GDP growth rate brought by a temporary rise in fiscal expenditure excluding tax reduction effects turned out to be 1.1%p in 2009 and 0.3%p in 2010, compared to the period without the increase in fiscal expenditure. Meanwhile, when taking into account the effect of expansionary fiscal policies including tax reduction effects, the increase effect of real GDP turns out to be much higher. In the case of 2009, the real GDP rose additionally by 1.9%p, in which 1.1%p by the increase in fiscal expenditure and 0.8%p by tax reduction. Based on these results, the expansionary fiscal policy conducted during the financial crisis since the second half of 2008 can be seen to have played a significant role in helping the Korean economy post a higher-than-anticipated recovery pace from the economic slowdown triggered by the crisis.

• Korean journal of communication and information
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• v.63
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• pp.5-25
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• 2013

Korean society suffers from severe divisions represented by bi-polarization and collapse of the middle class. Intensive demanding on expanding social welfare budget has emerged in accordance with such a dramatic shift. Social consensus moving toward well-financed welfare policy, however, happens to meet political opposition supported by the discourse of fiscal soundness. This paper thus pays particular attention to deciphering the discursive structure in way of understanding how discourses bring public policy into play. For this purpose, news articles about fiscal soundness collected from 8 national newspapers have been analyzed in terms of frame, attitude, perspective and world view. Research results show, first of all, that there exist persistent competition between two frames identified as 'reduced tax with fiscal discipline' and 'increased tax with welfare money.' While the 'reduced tax' frame favors in maintaining tax cut at the expense of welfare budjet, the frame of 'increased tax' supports such arguments as the flexible employment of fiscal soundness and prosperity of national community helped by widening tax revenues. Also did these frames include a number of sub-frames like welfare populism, partisan politics, trickle down effect, tax bonanza for the rich, universal welfare and market over-reactions in order to bolster its logical authority. Media's active taking a part in penetrating supportive frames in line with political stance was found as well. Taking into account both the discursive structure upheld by frames and politics materialized by the media, the authors argue that public policies should be considered more as discourse than fixed reality. Shedding additional light on understanding the interplay among public opinion, policies and media discourse is of another importance for further study.

• Korea journal of population studies
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• v.8 no.1
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• pp.65-86
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• 1985

Korean population is ecpected to reach about 50 million by year 2000. And per capita GNP might attain the $5,000 level. This is bound to have profound impact on housing. For one thing, population and income growth will accelerate new household formation thus increasing new housing needs. On the other, changes in the housing preference function in association with income growth and new way of life would mean increasing demand for better dwelling environment. In addition, by year 2000, there will be many more elderly households necessitating new approaches to housing. The question is whether or not Korea could cope with new housing perspectives. If Korean housing has made in the past some progress in housing quality, it has not been able to tackle the mounting housing shortage. This is attributable to the concentration of effective housing demand in the hands of upper income groups in association with skewed income distribution and sustained dwelling price hike. Korea needs some basic changes in housing policy. The public sector should produce much more small dwellings either for sales or renting. Second, mortgage loans should be expanded so as to increase the access to housing. Third, every thing must be done to cut down the dwelling price through tax cut, relaxation of some requlations, cyclical stabilization of dwelling construction and loan subsidies.