January tax collections increased by 1.5 percent year-on-year to 46.6 trillion won (US$31.8 billion), a sharp deceleration from the 7.1 percent growth recorded in the same month last year, according to data released by Statistics Korea on Friday.
The revenue progress rate reached only 12.2 percent of the annual target, falling below both last year's January rate of 13.6 percent and the five-year average of 12.6 percent.
While the growth showed signs of cooling down, a Ministry of Finance official said, "It's premature to make definitive judgments about this year's tax situation based solely on January's performance."
Value-added tax, one of the three major tax categories, declined by 8 trillion won from the previous year due to increased tax refunds and reduced imports. The securities transaction tax also fell by about 200 billion won compared to January 2024.
The lackluster revenue performance comes despite partial restoration of the flexible fuel tax rate and expanded performance-based salary payments, which marginally boosted transportation, energy, environmental, and income tax revenues.
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