NATIONAL

Parties shackled by welfare, tax row

By Korea Herald
  • Published : Nov 13, 2014 - 21:23
  • Updated : Nov 13, 2014 - 21:23
Welfare issues are overwhelming the political circles with the budget row spreading to tax issues while the main opposition party proposed yet another welfare program with an unsecured budget on Thursday.

At a forum titled “A house for newlyweds,” lawmakers of the main opposition New Politics Alliance for Democracy stated that funding for the project would be included in next year’s budget to provide coverage for 50,000 newlywed couples.

“(The party) will roll out a 3+2 policy that will provide 30,000 homes and lower the national housing fund’s interest rate to provide financial support for 20,000 (couples),” Rep. Hong Jong-haak.

Hong said that the party will push to allocate 243.2 billion won ($221.7 million) for the project in next year’s budget. He also argued that 1 million homes for newlyweds can be secured in the long term, and that the National Pension Service should be encouraged to invest in related projects.

While Hong trumpeted the new project, funding for which has yet to be secured, NPAD floor leader Rep. Woo Yoon-keun again emphasized the need to find funding for existing welfare projects.

The NPAD and the ruling Saenuri Party has been engaged in an expanding row over funding for free child care for toddlers and free school meals ever since the 2015 budget review began earlier this month.

The NPAD is demanding that funding for all such projects should be secured, while the ruling party and the government are backing plans to prioritize state funding and to make provincial education offices shoulder part of the burden.

“Normalizing corporate taxes for conglomerates is the solution,” Woo said. He said that large companies are estimated to have saved 39 trillion won in taxes due to the previous administration’s policies.

“Returning corporate taxes to the rates before the Lee Myung-bak administration can secure a maximum of 7 trillion won in tax revenues. By modifying the excessive non-tax benefits large companies can contribute 4 trillion won in tax revenues.”

The ruling party, which has effectively rejected raising corporate taxes almost immediately after the suggestion was made, chose instead to shift the focus toward the so-called “people’s livelihood bills.”

The term refers to bills designed to improve the economic conditions of the general public.

“Jobs are not only a source of income, but they also raise self-esteem, so creating jobs is welfare,” Saenuri Party chairman Rep. Kim Moo-sung said at the party’s supreme council meeting.

“To create jobs, economic stimulus measures and the livelihood bills need to be passed soon as possible, and in particular the service industry promotion act must be passed.”

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