Gov’t, Ruling Party Clash Over Economic Policy

The chasm between the Lee administration and the ruling Grand National Party over economic policy is widening further.

The government has rejected the tax-cut drive of the party as unacceptable, while the party has said no to the administration’s proposal for additional budget.

Leaders of the party’s policy committee and vice ministers from 17 ministries held a meeting Saturday at the National Assembly on bills for the April extraordinary parliamentary session. They failed, however, to agree any of the 54 bills put forward by the party.

The government reportedly opposed 12 bills on cutting taxes, citing budgetary pressure.

The party said, however, that it will cooperate with opposition parties to pass some of the bills without further high-level discussions with the government.

“Our priority was tax reduction and deregulation, but the government preferred more spending over tax cuts and administrative ease over deregulation. This is unacceptable,” said the party’s chief policy-maker Lee Hahn-koo after the meeting.

Gwon Gyeong-seok, a principal member of the party’s policy coordination committee, also said, “The administration has changed, but public servants still stick to their old practices. They only care about their own agencies and show a penchant for red tape. They should break away from old habits.”

The party said it will pass 17 bills that opposition parties agreed on in the last extraordinary parliamentary session in this month’s session, despite the government opposition.

“We talked to the government to listen to its position, not necessarily to incorporate its feedback for our position,” Gwon said. “The party will pursue as many priority bills as possible after talking with opposition parties.”

The 17 bills includes one on exempting components and raw materials for airplanes from value-added tax; another on cutting income and corporate taxes for small businesses in the cultural industry; and one on requiring public agencies to provide media centers.

Other bills include those on tax exemptions for donations to educational institutes; more financial support for families of Korean independence activists; and prevention of government control over personnel appointments at certain public agencies.

ditto@donga.com