The Korea Herald

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Lawmaker calls for tax on foreign IT giants

By Korea Herald

Published : Oct. 16, 2013 - 19:54

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A ruling party lawmaker has called for a tax on Google, Apple and other foreign firms on profits generated from Korean-made content.

The Saenuri Party’s Rep. Nam Kyung-pil Tuesday said the government should seek out new revenue sources for the Broadcasting Communication Development Fund, which is dwindling due to the drop in terrestrial broadcasters’ advertising revenues.

Nam said the French government has been developing plans since May to levy a “culture tax” varying from 1 percent to 4 percent on smartphones, tablet computers and other mobile devices.

Nam also said that if introduced, the tax would generate an estimated 124 billion won ($116 million) in additional tax income for the French government.

“A value-added tax of 10 percent is levied on local companies’ content sales, but there is no standard for global companies like Google and Apple,” Nam said.

“The Ministry of Strategy and Finance is reviewing ways to tax (related revenues) but the industry’s view is that it would not be possible.”

The suggestion, made at Tuesday’s parliamentary audit of the Korea Communications Commission, comes amid strong criticism from the main opposition Democratic Party that the Korean government is trying to rein in Web portal sites.

Also on Tuesday, the Ministry of Science, ICT and Future Planning came under fire from DP lawmakers over its guidelines for online search service providers.

The guidelines, drawn up in an effort to increase the transparency and fairness of Internet searches, state that service providers differentiate between simple search results and those linked to advertising.

By Choi He-suk (cheesuk@heraldcorp.com)