Wednesday, November 13, 2019
Japanese Companies Operating in Korea Pay a Low Tax Rate
300 Bil. Won Paid in Taxes on 48 Tril. Won in Sales
Japanese Companies Operating in Korea Pay a Low Tax Rate
  • By Michael Herh
  • October 29, 2019, 11:31
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Japanese companies operating in Korea paid low taxes during the past four years.

Although Japanese companies earned nearly 48 trillion won in sales in Korea in the past four years, they paid only 300 billion won in taxes.

According to the data the National Tax Service submitted to lawmaker Kim Doo-kwan of the ruling Democratic Party on Oct. 28, Japanese companies operating in Korea paid a total of 301 billion won in taxes during the four years from 2015 to 2018. Their sales amounted to 47,527.1 billion won during this period.

The number of Japanese companies operating in Korea decreased from 399 in 2015 to 371 in 2018, but their sales jumped from 8 trillion won in 2015 to 13 trillion won in 2018. As a result, their tax burden swelled from the 50 billion won level to the 100 billion won level. However, the proportion of their taxes in their sales further dwindled.

As of last year, 14 of 381 Japanese corporations in Korea were listed on the Korean stock market.

“The majority of Japanese subsidiaries are small and medium-sized as 12 listed Japanese companies excluding the two added this year paid 82,754 million won in taxes from 2015 to 2018,” Kim said.

By industry, wholesalers totaled 162 in 2017, accounting for 42.4 percent, followed by those in the service industry with 35.8 percent. The two were followed by companies in the financial and insurance, real estate, and retail industries. Manufacturing companies numbered 24, representing 6.3 percent of the total.