Lim Gwang-hyun: "Tax Revenue Is Skewed, Future Response Fund Is Essential"

National Tax Service Commissioner Lim Gwang-hyun has stated that a "Future Response Fund," to be created using tax revenue increased by the semiconductor boom, is essential for sustainable fiscal management.

On Sunday, July 12, Commissioner Lim posted on X (formerly Twitter) under the title "For Today's Tax Revenue to Become Tomorrow's Competitiveness," emphasizing, "Sustainable fiscal management depends not only on how much tax revenue is secured, but also on how stable the structure of that revenue is."

He described the tax revenue that has fluctuated since 2000 in line with semiconductor market cycles as a "skewed portfolio," adding, "As someone responsible for the nation's revenue, this is always a concern."

He pointed out, "When the semiconductor industry is booming, tax revenue increases rapidly, centered on corporate tax; however, when the semiconductor market slows down, corporate performance worsens and tax revenue decreases, leading to recurring difficulties in fiscal management."

His point is that while the average tax revenue growth rate over the past 20 years has been 5.71%, the amplitude of that growth has been too large due to semiconductor market fluctuations.

For instance, in 2021, tax revenue increased by 20.6% compared to the previous year due to the semiconductor boom related to non-face-to-face activities during the COVID-19 pandemic, but two years later, it decreased by 12.6% due to a slowdown in IT demand.

Commissioner Lim suggested, "In terms of diversifying the tax revenue portfolio, we must continue to foster the semiconductor industry, our core competitive edge, as a 'super-gap' industry to solidify our global technological dominance," adding, "We must also actively invest in and foster new strategic industries that will be our future growth engines."

He further predicted, "This will not only secure future growth engines but also diversify the industrial structure, which will lead to a virtuous cycle of building a more balanced and stable tax revenue base in the long term."

He continued, "Therefore, the plan to create a 'Future Response Fund' to use the additional tax revenue from the semiconductor boom to support the three major mega-projects and strengthen the nation's long-term competitiveness is an essential policy."

He also expressed his expectation, saying, "From the perspective of a revenue agency, it will be possible to simultaneously secure fiscal sustainability to prepare for the increasing welfare demand due to low birth rates and an aging population, as well as tomorrow's competitiveness."

(Photo: Screenshot of Commissioner Lim Gwang-hyun's X account, Yonhap News)
※ Please note: This article was translated by AI and may contain errors.