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S. Korea considers duty-free limit on overseas direct buyingBy Jung Min-kyung
Published : Oct. 19, 2020 - 16:18
The move comes as the government has been eyeing ways to invigorate domestic consumption and Korea Customs Service Commissioner Roh Suk-hwan’s announcement of the idea in a parliamentary audit last week.
“(From December, the) KCS will make mandatory for consumers to receive personal customs clearance codes to analyze their overseas direct purchase patterns for around a year,” a KCS official said.
“We believe related bills could be amended in 2022 through consultation with the Ministry of Economy and Finance,” the official added.
A Finance Ministry official said that they would “cooperate with the KCS, if the organization deems the tax-free limit necessary.”
South Korean consumers receive duty-free benefits if the price of an item purchased directly from overseas is either equal to or below $150. There is no upper ceiling on cumulative purchases, as long as each transaction stays below $150.
While placing tax restrictions on the act of direct purchasing from overseas has continued to see divided opinions, most have agreed that Korea should bolster its monitoring of any illegal or unfair acts tied to the transactions.
China and the European Union have stricter tax rules for such overseas direct purchases.
The total value of Koreans’ direct purchases from online retailers more than doubled in 2019 compared to 2015, with the figure jumping from $1.51 billion to $3.14 billion in the cited period, KCS data showed. In terms of transactions, the figure jumped from 15.84 million to 42.99 million in the same period.
The popularity of overseas direct purchases continued into the first half of this year, despite coronavirus woes, with transaction figures standing at 36.87 million as of end-August.
By Jung Min-kyung (email@example.com)
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