South Korea's ruling and opposition lawmakers clashed during an interpellation session in parliament over whether an increase in corporate taxes will be effective in revitalizing the economy.

While opposition lawmakers claim that corporate taxes, which were significantly reduced in the previous administration, must be increased again, the government maintains that such a move will adversely impact business operations, eventually leading to an economic slump.

Rep. Choi Woon-youl of the main opposition Minjoo Party of Korea said the existing system widens the gap among income brackets, and is beneficial for business leaders and foreign investors.

"The government is implementing expansionary fiscal policy while cutting taxes. Accordingly, the national debt is increasing by some 40 trillion won ($36.2 billion) every year," the lawmaker said, adding President Park Geun-hye's plan to expand welfare programs without increasing taxes is problematic.

Rep. Park Kwang-on from the same party echoed the view, adding increasing corporate taxes can secure a sufficient budget for welfare and achieve equality in the country's taxation system.

The ruling Saenuri Party, however, said an increase in corporate taxes can spark an outflow of local firms and make it harder to attract foreign direct investment.

"If the government puts pressure on businesses, more of them will relocate abroad," Rep. Yoon Sang-jick of the Saenuri said.

Such a development will hurt the local job market and the economy as a whole, and slow down recovery. (Yonhap)