|Deputy Prime Minister and Minister of Economy and Finance Choo Kyung-ho speaks at a preliminary press briefing on the 2023 tax law revision held at the Sejong Government Complex in Sejong City on July 24, 2023./ Photographed by Park Sung-il|
AsiaToday reporter Lee Ji-hoon
The government has decided to ease gift tax on wedding funds of up to 150 million won supported by parents, and increase financial support for households with an annual income below 70 million won. The move is aimed at strengthening tax support for marriage, childbirth, and parenting to overcome demographic crisis such as population decline.
The government has confirmed the 2023 tax law revision bill during a tax development review committee meeting held at the Bank of Korea in Seoul on Thursday.
Under the revision, the government will allow parents to give an additional 100 million won to adult children without a gift tax two years before and after the marriage, in addition to the basic deduction of 50 million won for every 10 years. This means that the government will not impose gift taxes up to 150 million won supported by parents within four years before and after the marriage registration. In other words, both the bride and groom can receive up to 300 million won from their parents without tax, 150 million won each, if they have no asset received over the past 10 years.
The government will greatly expand child incentives. It will increase financial support for households with an annual income below 70 million won, providing up to 1 million won per child, a substantial increase from the current 800,000 won offered to those with earnings under 40 million won. The government estimated that nearly 1.04 million households will be benefited from the current 580,000 households, and the payment will be increased to 1 trillion won from 500 billion won.
Through the tax code revision, the government will also push for improving economic vitality such as exports, investment and domestic demand, recovering the people’s livelihood such as easing the tax burden on the working and middle class, preparing for the future such as overcoming population and regional crises.
“We will boldly support our companies so they can compete on the international stage,” Deputy Prime Minister and Minister of Economy and Finance Choo Kyung-ho said. “We will strengthen support for the rapid recovery of the public economy and actively respond to structural problems for preparations for the future, such as population decline and regional extinction.”