Lowest among OECD Countries
South Korea's tax burden remains in a lowest level among OECD countries.
The Korea’s tax burden rate, which is the ratio of taxes including the national tax and the local tax to the gross domestic product (GDP), was 18.5% in 2015, the lowest along with Slovakia, according to the OECD.
Even though the figures of Mexico, Japan, Poland, Australia and Mexico for the fiscal year 2015 have not been unveiled, most of the OECD members are supposed to have higher tax burdens than Korea, except for Mexico that shows a 10% level continuously.
Korea was the third-lowest country with the ratio of 18.0% in 2014, following Mexico with 12.0% and Slovakia with 17.9%, when all the related data were from the 35 OECD members. The average for the 35 members stood at 25.1 percent.
The figure of Denmark reached 49.5%, with Sweden, Finland and Norway showing 32.9%, 31.2%, and 28.8%, respectively. France, the UK and Germany showed 28.5%, 26.1% and 22.3% each while the US and Japan numbered 19.7% and 19.3%.
There seems to be much room left to raise taxes because Korea has relatively a low tax burden rate compared to the other OECD members. Actually, a series of voices are now emerging that Korea should raise its tax burden rate in order to secure money for the welfare expansion, in particular, due to the rapid aging, and the growth potentiality.