KCCI Chairman Urges the Abolishment of Inheritance Tax

Korea Chamber of Commerce and Industry Chairman Sohn Kyung-sik argued on Friday that the inheritance tax should be abolished because it is imposed on unrealized profits.

The KCCI chairman made the argument at a meeting with chairmen of the nation’s local chambers of commerce and industry at a conference held at the Lotte Hotel in central Seoul. In the presence of Prime Minister Han Seung-soo, who also attended the meeting, the chairman said, “Many people have to sell inherited stocks or real property in order to pay the inheritance tax. That threatens the management control of many firms.”

Sohn added, “The government needs to consider the imposition of a capital gains tax (transfer income tax) on the inheritance when the heirs sell the inheritance, instead of outright abolishing the inheritance tax. Canada, Australia and Italy have already abolished the inheritance tax. The United States is also considering ending its inheritance tax.”

According to KCCI Director Lee Hyeon-seok, the prime minister said, “We’re discussing how to reform the inheritance and gift taxes. We’ll examine the issue further since it is quite significant for smaller firms.”

The KCCI chairman also urged the government to come up with reasonable policies to deal with high consumer prices, saying, “In order to minimize the shock from worldwide inflation, the government needs to place a higher priority on stabilizing the prices of raw material and intermediary goods.”

He added, “The individual consumption tax (formerly, special consumption tax) should be placed on luxurious goods. It’s not right to impose the tax on industrial heavy oil and liquefied natural gas, which are key material for the manufacturing industry.”

With regard to the special investigation over Samsung Group’s slush fund scandal, the chairman said, “It’s gone on long enough. I hope the special investigation team wraps up its work as soon as possible.”

Though the prime minister did not give a direct response to the issues, he did say, “It’s hard to say, but those associated with Buddhism and those associated with the business community both seem to share these views.”

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