The government has reportedly proposed to labor groups a plan to ease the labor union financial disclosure system. The union accounting disclosure is a system introduced in 2023 by the Yoon Suk-yeol administration, which said it would strengthen unions' financial transparency. The centerpiece is to grant a 15% tax credit on union dues at year-end tax settlement only to unions that have made disclosures.
According to labor groups 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 joint liability rule so that even if the superior organization did not disclose its accounts, subordinate unions could still receive tax benefits if they disclosed theirs.
Currently, unions with 1,000 or fewer members are not required to disclose their accounts on their own. However, if their affiliated superior organization does not disclose, they likewise cannot receive the tax credit, by design. The government's plan is to separate this so that if a subordinate union makes its own disclosure, it can receive the tax credit.
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 going forward, the idea is to grant the tax credit even if only the Hyundai Motor local makes its own disclosure.
Labor groups say the financial disclosure system should not be eased but abolished altogether. Still, the two major umbrella unions plan to proceed with disclosures this year to prevent disadvantages to members. In principle, union accounts must be disclosed by Apr. 30 each year.