[Exclusive] Pres. Lee Urges Caution Over Tax Cuts

President Lee Myung-bak urged politicians Sunday not to deal with tax cuts from an ideological perspective, saying, “The principal policy direction should be to cut taxes to reduce tax rates and expand tax resources. In this way, we can raise competitiveness.”

He said this in an exclusive interview with The Dong-A Ilbo in Yokohama, Japan, on the sidelines of the Asia-Pacific Economic Cooperation summit. President Lee arrived in Japan shortly after the close of the Group of 20 summit in Seoul, and the 73-minute interview was held at Yokohama’s New Grand Hotel, where he stayed.

“The decision on whether deferred cuts (in income and corporate tax rates) will be carried out in 2013 or delayed another year will be made according to economic conditions. The change in the schedule will not break the big principle (of tax cuts),” he said.

On the direction of his administration after the G-20 summit, President Lee said, “I will lay the groundwork for turning the country into an advanced nation over my term. That’s why I campaign for a fair society. Some interpret my fair society campaign as politics to control society. But this is not the case. My goal is to lay the foundation for the next government to succeed.”

On political reforms, he repeatedly emphasized the need for administrative zone realignment, saying, “We’ve silently made preparations for that and will devise more detailed plans on the realignment and announce them before year’s end.”

Turning to inter-Korean ties, President Lee said, “Relations look a bit unstable but are going back on track. If we continue past practices, we will not bring peace and North Korea will remain in poverty,” but added, “Some are urging us to help the North without precondition but this is not the right solution.”

Mentioning the sinking of the South Korean naval vessel Cheonan, he said, “North Korea refuses to acknowledge and apologize for the attack, saying we are responsible for the incident. There are those who raise different voices due to political interests though they know the vessel was attacked by the North.”

“North Korea is holding out by relying on such people in the South, but the longer the North holds out, the bigger damage it will suffer.”

On the North’s third-generation hereditary power transfer, President Lee said, “We don’t need excessive interest in this.”

He also lauded the G-20 Seoul summit, saying, “We can take pride in the successful result but should not brag about it. If so, this will lead to arrogance and failure,” adding, “Through a public briefing, we will seek future direction.”

“I was the leader but the G-20 was successful due to our people’s mature citizenship and our ministers playing their parts at the Sherpa meeting. I’d like to applaud our people’s mature citizenship.”

yongari@donga.com jkmas@donga.com