The government has reportedly proposed to labor groups a plan to ease the labor union accounting disclosure system. The union accounting disclosure is a system introduced in 2023 by the Yoon Suk-yeol administration, which said it would strengthen unions' accounting transparency. The core is to grant a 15% tax credit on dues at year-end tax settlement only to unions that made accounting disclosures.
According to labor circles on the 19th, the Ministry of Employment and Labor (MOEL) recently told the Federation of Korean Trade Unions and the Korean Confederation of Trade Unions (KCTU) that it would abolish the guilt-by-association rule so that even if an umbrella organization did not disclose its accounts, affiliates could still receive tax benefits if they made disclosures.
Currently, unions with 1,000 or fewer members have no obligation to disclose on their own. However, if their umbrella organization does not disclose, they likewise cannot receive the tax credit. The government's plan is to separate this so that affiliates can receive the tax credit if they disclose on their own. For example, in the case of the Hyundai Motor local under the KCTU's Korean Metal Workers' Union, the KCTU, the Metal Workers' Union, and the Hyundai Motor local all currently must disclose accounts to receive the tax credit, but the plan would grant the tax credit even if only the Hyundai Motor local makes its own disclosure.
In response, labor groups say the accounting disclosure system should not be eased but abolished altogether. However, the two major national labor federations plan to proceed with disclosures this year to prevent disadvantages to members. In principle, union accounts must be disclosed by Apr. 30 every year.