Special Excise Tax on 13 Items Will Not Be Abolished

The special excise tax on 13 items, including jewelry and perfume, will remain unchanged.

However, starting on September 23, a special excise tax on 11 items, including air conditioners, plasma display panel (PDP) TVs, and golf supplies, will be removed, and their prices will fall as a result.

At a general meeting with the Code Deliberation Subcommittee on September 20, the Finance and Economy Committee (FEC) deliberated a revised bill that Rep. Kim Jin-pyo proposed and decided as follows:

Among 24 items, the FEC decided to keep the current tax rate on the 13 items, such as jewelry, high-class cameras, watches, carpets, furs, furniture, royal jelly, perfume, hunting rifles, and etc.

As lawmakers of the Grand National Party disagreed on the abolition of the special excise tax, saying that these luxury items are irrelevant to the economy, Uri Party lawmakers accepted the idea and modified the revision bill.

The FEC decided to abolish the special excise tax on 11 items: projection and PDP TVs, air conditioners, hot blast heaters, golf supplies, motorboats, yachts, water skis, hang gliders, projectors, and cameras.

The consumer prices of projection TVs will be lowered by 6.8 percent, PDP TVs lowered by 1.0 percent, air conditioners and hot blast heaters by 12.7 percent, golf supplies by 16.4 percent, and motorboats, yachts, water skis, hang gliders, projectors and cameras by 15.4 percent.

The bill will take effect as soon as the National Assembly passes the bill on September 22. Accordingly, consumers will be able to buy the 11 items at their new lowered prices starting September 23. Merchants will be able to have the special excise tax of items in their inventory refunded.

Meanwhile, although Rep. Park Jae-wan proposed bills to abolish the special excise tax on small- and mid-sized cars under 2000 cc, and to temporarily reduce the special excise tax on oil, which were deliberated by the committee, the ruling party and the opposition party did not come to an conclusion and agreed to deliberate on the bills again in the Deliberation Subcommittee at a later date.

Young-Hae Choi yhchoi65@donga.com