Reporting of O`seas Deposit Accounts to Start in `11

Individuals or companies with deposit accounts abroad must report them and the amounts to tax authorities from 2011.

The comprehensive property tax will be changed in 2011 into a provincial or municipal property tax.

Officials from the Strategy and Finance Ministry, the Financial Services Commission, the Fair Trade Commission, the National Tax Service, the Korea Customs Service, the Public Procurement Service, and the National Statistical Office jointly presented this agenda in the “2010 Work Plan in the Economic, Financial and Corporate Sectors” to President Lee Myung-bak at the Korea Chamber of Commerce and Industry in Seoul yesterday.

Gas charges will be tied to international oil prices from March next year, and the same system will be applied to electricity rates from 2011. To encourage childbirth, families with more than three children will get higher interest on deposits or lower interest rates on mortgage loans.

Government Agencies in charge of economic affairs said they will focus on measures to create more jobs; stabilize the people’s livelihood; develop the economy; improve Korea’s national dignity by strengthening external capabilities; and pursue green growth.

To expand the tax base and prevent the hiding of wealth abroad, Korean nationals will have to report deposit accounts held abroad. To this end, the government will analyze an individual’s income and spending and manage tax data of companies and their owners.

The comprehensive property tax, which was introduced in 2005 but ruled unconstitutional last year, will be changed into a provincial or municipal tax as the last part of three-stage tax reform plan.

President Lee said at the briefing, “We have to spend money in an effective and timely manner. We should also be wiser to resolve difficulties related to the people’s daily life as soon as possible.”

“In the first half of next year, I’ll hold a meeting to find out whether the plans have been pursued as planned.”

cha@donga.com