On June 22, a meeting titled 'Why Now for Departure Tax Reform?' took place at the National Assembly. Key figures from the government, legislature, academia, and tourism industry gathered to discuss the urgent need for increased tourism funding.
The departure tax accounts for about 30% of the revenue generated by the tourism fund, which supports the travel industry and citizens. In July 2024, the government reduced the departure tax from 10,000 won to 7,000 won, expanding the exemption from children under two years old to those under twelve. However, this decision has led to a loss of over 130 billion won annually, resulting in reduced regional tourism budgets and increased debt.
Lawmaker Jo Gye-won stated, "The Yoon Suk-yeol administration's reduction of the departure tax, labeled as a 'shadow tax,' has only deepened the fund's debt. While major countries charge an average of 29,000 won in departure taxes, ours is only 7,000 won. We are losing 22,000 won per foreign visitor. Without solid financial backing, the goal of attracting 30 million tourists could become a house of cards."
During the meeting, Ryu Kwang-hoon, a senior researcher at the Korea Culture and Tourism Institute, warned of the financial crisis with specific figures. He noted that the departure tax, which has remained unchanged for 27 years since its introduction in 1997, was reduced by 30%, leading to an estimated 21.8% drop in revenue to 262.4 billion won in 2025 compared to the previous year. Additionally, the 2.4 trillion won borrowed during the COVID-19 pandemic incurs annual interest of 50 billion won, exacerbating financial pressure.
Ryu pointed out, "While the nominal GDP per capita has grown from about 12 million won in 1997 to over 51 million won today, our departure tax system remains unchanged since 1997, making it unrealistic."
In contrast, other countries are aggressively increasing their tourism funding. Japan plans to raise its international tourism passenger tax from 1,000 yen (about 9,500 won) to 3,000 yen (about 28,500 won). Australia has steadily increased its departure tax to 70 Australian dollars (about 75,000 won) as of 2024. Thailand raised its departure tax by about 50% to 54,000 won on June 20. Additionally, Bali, Indonesia, will introduce a tourist tax of 150,000 rupiah (about 13,000 won) for foreign visitors in February 2024.
The reduction of the tourism fund is directly impacting the industry. Yoo Yong-jong, president of the Korea Hotel Association, expressed, "The hotel industry requires significant initial investment, and policy financing support is essential. However, due to the lack of funds, infrastructure expansion and staff training programs are being scaled back."
While the tourism industry agrees on the need for departure tax reform, they call for a careful approach. Hwang Jun-seok, executive vice president of the Korea Travel Agency Association, cautioned, "Increasing the departure tax could burden citizens or dampen demand. Discussions should consider the public's ability to bear the cost and its impact on the industry to ensure a reasonable level of acceptance."
To gain public support, both industry and academia emphasize the need for transparent fund management and structural reform. Lee Kyung-soo, president of the Korea Tourism Association, proposed prioritizing investments in regional tourism innovation, enhancing travel safety, and improving tourism infrastructure. He stated, "We must not only increase the burden but also transparently disclose how the secured funds are used and their outcomes to gain public trust."
Jo Kwang-ik, vice president of the Korea Tourism Society, also suggested, "To bridge the gap between contributors and beneficiaries, we need to return the funds to the public through indirect support like vouchers or vacation assistance. Currently, about half of the fund is allocated to business loans, creating a situation where 'those who pay are different from those who benefit.' Reforming the fund structure, including limits on loan support, is necessary."
Policies leveraging the tourism fund have shown clear economic benefits. According to the Korea Tourism Organization, from January to April this year, the number of foreign tourists visiting Korea reached 6.77 million, a 21.4% increase compared to the same period last year. Notably, arrivals at regional airports surged by 45.3% to 1.205 million. Consequently, total foreign spending from January to May amounted to 7.9845 trillion won (a 47.3% increase), with regional spending reaching 2.6742 trillion won (a 42.7% increase), significantly contributing to local economies.
The domestic economic boost is also evident in the data. During the same period, the number of domestic tourists visiting regions outside the capital increased by 2.2% to 1.27664 billion, while visits to non-capital areas rose by 2.3% to 659.82 million. National tourism spending also showed solid growth, reaching 66.8894 trillion won (a 9.0% increase) nationwide, with non-capital area spending at 27.4705 trillion won (a 10.2% increase).
The success of programs funded by the tourism fund is notable. The 'Worker Vacation Support Program' generated 57.3% of new travel demand, with an average tourism spending of 914,080 won per person, yielding an economic impact 9.14 times greater than the government support of 100,000 won. The 'Accommodation Sale Festa' provided 1.52 million discount coupons, attracting approximately 2.3 million new travelers to local areas.
Park Sung-hyuk, president of the Korea Tourism Organization, stated, "The fund is not just a budget; it is the most reliable investment resource for revitalizing the domestic economy and enhancing national competitiveness. To achieve the goal of 30 million foreign tourists by 2028 and expand our global tourism footprint, stable funding is essential."
The government is also committed to improving the system. Kang Dong-jin, Director of Tourism Policy at the Ministry of Culture, Sports and Tourism, remarked, "Tourism is a key export industry and a vital sector for preventing regional decline. We will focus on enhancing the tourism fund through departure tax reform to achieve the early goal of attracting 30 million foreign tourists."
Lawmaker Jo Gye-won added, "Since the fund is generated from the departure tax paid by citizens, it must be transparently disclosed and returned to the public through tangible policies. We will do our best in the legislative process to ensure this."
* This article has been translated by AI.
Copyright ⓒ Aju Press All rights reserved.