The ruling Saenuri Party and the main opposition Democratic United Party resumed negotiations over the supplementary budget plans Friday after they reached an agreement on reducing tax exemptions for large corporations.
The parties are expected to process the extra spending bill before the April session of the National Assembly ends Tuesday.
The proceedings of the parliament’s Special Committee on Budget and Accounts had come to a halt with the DUP refusing to review the plans unless measures to increase the government’s tax revenues were included.
The DUP has been calling for taxes to be increased, while the ruling party has opposed the plans, saying that a tax hike would cancel out the stimulating effect of the supplementary budget.
As a compromise, the parties agreed to reduce the tax exemption by 1 percentage point for large corporations’ investments, which are crucial to maintaining overall employment.
According to the parties, the change will increase tax revenues by as much as 200 billion won ($182 million) from 2015.
In addition to the measure, the two parties also agreed to review modifying the tax brackets and the minimum tax suggested by the DUP to increase taxes gathered from high-income groups and large corporations.
By Choi He-suk (firstname.lastname@example.org