The Democratic Party of Korea is pushing for a revision to raise the basic deduction amount for income taxes from 1.5 million won to 1.8 million won. This comes just a day after Lee Jae-myung, the party's leader, announced on his social networking service (SNS) that he would realize the earned income tax basic deduction. If the legislation is completed, the basic deduction amount for income taxes will be reformed for the first time in 16 years since 2009.

Democratic Party lawmaker Lim Kwang-hyun announces on Mar. 3 at the National Assembly's communication hall in Yeouido, Seoul, that he plans to propose an amendment to the income tax law to actualize the basic income tax deduction from 1.5 million won to 1.8 million won. /Courtesy of Yonhap News

Lim Kwang-hyeon, the secretary of the Democratic Party’s salary defense corps, held a press conference at the National Assembly’s communication hall on the morning of the 3rd and announced that he would submit a revision to the income tax law to raise the basic deduction amount.

Lim noted, "Given that the basic deduction amount has been frozen at 1.5 million won for 16 years, while earned income taxes have nearly quintupled during the same period, it is necessary to adjust the deduction amount." He added, "Recently, due to the tax cut for large corporations and extremely wealthy individuals, the tax burden ratio compared to our country’s gross domestic product (GDP) has sharply declined, while the burden ratio for earned income taxes has actually increased."

He emphasized, "The situation is such that the tax cut for the wealthy is being covered by the pockets of salary workers, and it is essentially as if we have undergone a forced tax increase of nearly 20 trillion won solely due to inflation, making it unfair that the earned income tax basic deduction amount has remained unchanged for 16 years."

According to Lim, earned income tax revenue reached 61.5 trillion won last year, up 59.7% from 38.5 trillion won in 2019. The tax burden ratio for earned income taxes also increased from 1.6% in 2015 to 2.4% last year. In particular, when applying the income tax law based on 2014 to the prices of 2022, the tax increase effect due to inflation was estimated to reach 19.5 trillion won.

Earlier, Lee Jae-myung also said on Facebook the previous day, "Amid the tax cut for large corporations and extremely wealthy individuals causing a decline in the overall tax burden ratio in our country, it is said that the tax burden ratio for earned income taxes has only increased," and added, "No wonder people keep asking, 'Is the salary worker a fool?'"