The government remains reserved about hiking tax rates, the finance minister said Thursday, adding that he prefers expanding the overall revenue base by reducing existing tax breaks and exemptions.

The remarks by Hyun Oh-seok came a day after the National Assembly passed laws that will lower the taxable annual income threshold subject to the highest tax rate.

This change would eventually result in more people paying more taxes, which critics say would run counter to the President Park Geun-hye government's repeated promise that there will be no tax hikes during her five-year term.

Finance Minister Hyun expressed his opposition to tax hikes, saying that he would rather streamline and eventually reduce tax breaks and exemption programs.

"With regard to the tax increase agreed upon at the National Assembly, it is right for the government to follow," Hyun told reporters during his visit to the press room here.

"Still, the government's basic policy direction is to broaden its revenue base rather than to directly hike up tax rates," he said.

He left the door open to the possibility, however, adding that the government should follow if there is a public consensus for the tax hike.

Meanwhile, he expressed concerns over the recent depreciation of the Japanese yen, saying the government will continue to work hard to minimize its impact on smaller local businesses that are more vulnerable to such currency fluctuations.

"To some extent, we have expected it (the yen's depreciation), but the shock could be a little bit more serious than we have thought," he said. "The government will consider measures aimed at strengthening its support for small and medium-sized companies." (Yonhap News)