Next week, the finance ministry is scheduled to announce a set of tax code revisions which regularly take place twice a year.

But he said the government is taking a prudent stance in raising nominal income and corporate tax rates in order to strike a balance between strengthening taxation and realizing justice in taxation.

Kim's comments came as the issue of a tax increase has emerged as a hot potato in politics as the governing Democratic Party mentioned a potential tax hike by calling it a "normalization" of the taxation system or a pursuit of a "more equitable" regime.

While on the campaign trail, Moon hinted at corporate and income tax hikes, and a removal of tax exemptions and benefits to secure funding to push through his various agendas.

Moon has vowed to create some 800,000 public jobs during his five-year term, grant an allowance to young jobseekers and offer public residence to newlyweds at affordable rent.

South Korea will need an additional 178 trillion won ($159.6 billion) over the five-year period to fulfill Moon's pledges, according to government data. (Yonhap)