Free child care is likely to be expanded to all children aged 5 and under starting from 2013, as the ruling camp seeks to implement President-elect Park Geun-hye’s welfare pledges.

To fund it and other welfare expansion plans, the ruling Saenuri Party is also moving to increase tax revenues by drastically lowering the ceiling for a comprehensive financial income tax.

Currently, about 50,000 Koreans who earn more than 40 million won a year in financial gains such as interest and dividends are subject to a tax of 38 percent. The planned measure would lower the bar to 20 million won, making 150,000 newly subject to the levy, for additional tax revenue of 300 billion won.

A related bill, backed by both the Saenuri Party and the main opposition Democratic United Party, was submitted to the National Assembly’s Legislation and Judiciary Committee on Friday, the last stop before a plenary vote.

The envisioned free child care program also has bipartisan support in the parliament. It was among the items in Park’s presidential election platform that her liberal rival from the DUP, Moon Jae-in, had no disagreement with.

Members of the parliamentary budget committee have agreed to set aside 1.4 trillion won more in the 2013 governmental spending plan to bankroll the expansion of free child care services, party officials said.

Under the envisioned plan, parents will be given the option of free attendance at child care centers or a monthly allowance of up to 200,000 won ($187), regardless of their income.

For the government, however, this represents a U-turn in child care policy.

In September, then wary of political slogans on welfare expansion amid growing fiscal burden, the government had said it would scrap in 2013 a program which provided free day care services for all children under the age of 2.

Instead, it had sought to provide state subsidies to families in the bottom 70 percent of earners only and differentiate the coverage of day care services provided, depending on whether or not parents both work.

“Plans to exclude the upper 30 percent income earners from the subsidy program and differentiate stay-at-home moms and working moms in provision of free day care services are all scrapped,” a member of the budget committee was quoted as saying by Yonhap News. “It is safe to say that child care becomes free for all (children aged 0 to 5), starting from 2013.”

By Lee Sun-young (milaya@heraldcorp.com)