Most Popular
-
1
Dongduk Women’s University halts coeducation talks
-
2
Defense ministry denies special treatment for BTS’ V amid phone use allegations
-
3
Russia sent 'anti-air' missiles to Pyongyang, Yoon's aide says
-
4
OpenAI in talks with Samsung to power AI features, report says
-
5
Two jailed for forcing disabled teens into prostitution
-
6
Trump picks ex-N. Korea policy official as his principal deputy national security adviser
-
7
South Korean military plans to launch new division for future warfare
-
8
Gold bars and cash bundles; authorities confiscate millions from tax dodgers
-
9
Kia EV9 GT marks world debut at LA Motor Show
-
10
Teen smoking, drinking decline, while mental health, dietary habits worsen
Ministry discord delays duty-free expansion
Tax issues emerge as key stumbling block to stores in arrivals areas amid rising number of outbound Korean travelers
By Seo Jee-yeonPublished : July 21, 2013 - 19:27
A long-sought policy project to allow duty-free shops in the arrivals area of Incheon International Airport is likely to be delayed again as the ministries involved remain at odds over the plan.
The Ministry of Strategy and Finance and the Ministry of Land, Infrastructure and Transport ― the two main ministries with an interest in the plan ― have failed to reach an agreement for more than six months.
The Office for Government Policy Coordination under the Prime Minister’s Office intervened to put the project on a list of mid- and long-term policy tasks in a meeting on Friday.
The debate over duty-free purchase on arrival, which has continued since 2001, was rekindled at the end of last year when Rep. Ahn Hyo-dae from the ruling Saenuri Party proposed a bill to allow the opening of duty-free shops for passengers arriving at Incheon International Airport.
He claimed that most of all, duty-free shops in the arrivals zone were needed to facilitate spending of foreign visitors to Korea. According to him, 117 airports in 63 countries already run duty-free shops in their arrivals areas.
The Ministry of Land, Infrastructure and Transport and Incheon International Airport under the wing of the ministry have been on the same side as Ahn.
But the Ministry of Strategy and Finance and its affiliate agencies, such as the Korea Customs Service, have opposed the bill, arguing that it would lead to unfairness in taxation.
Hyun Oh-seok, deputy prime minister for economic affairs, expressed a negative view in a recent interview with local media outlets, citing the possibility of widening inequality in taxation if the new duty-free shops were allowed. Hyun said it would be unfair to give Koreans who can afford to make overseas trips opportunities to buy duty-free items, while Koreans who cannot afford to go abroad have to pay taxes on those products.
The Finance Ministry also said duty-free shopping in the arrivals zone would make the baggage claim process longer and customs areas more crowded, which would inconvenience passengers.
Despite these concerns, industry watchers said the real worry of the Finance Ministry was loss of tax revenue amid a rising number of outbound Korean travelers.
According to the Korea Tourism Organization, despite the protracted slump in domestic consumption, the number of outbound Korean travelers hit a record high of 7.23 million for the first half of this year, a 9.6 percent rise from the same period last year.
By Seo Jee-yeon (jyseo@heraldcorp.com)
The Ministry of Strategy and Finance and the Ministry of Land, Infrastructure and Transport ― the two main ministries with an interest in the plan ― have failed to reach an agreement for more than six months.
The Office for Government Policy Coordination under the Prime Minister’s Office intervened to put the project on a list of mid- and long-term policy tasks in a meeting on Friday.
The debate over duty-free purchase on arrival, which has continued since 2001, was rekindled at the end of last year when Rep. Ahn Hyo-dae from the ruling Saenuri Party proposed a bill to allow the opening of duty-free shops for passengers arriving at Incheon International Airport.
He claimed that most of all, duty-free shops in the arrivals zone were needed to facilitate spending of foreign visitors to Korea. According to him, 117 airports in 63 countries already run duty-free shops in their arrivals areas.
The Ministry of Land, Infrastructure and Transport and Incheon International Airport under the wing of the ministry have been on the same side as Ahn.
But the Ministry of Strategy and Finance and its affiliate agencies, such as the Korea Customs Service, have opposed the bill, arguing that it would lead to unfairness in taxation.
Hyun Oh-seok, deputy prime minister for economic affairs, expressed a negative view in a recent interview with local media outlets, citing the possibility of widening inequality in taxation if the new duty-free shops were allowed. Hyun said it would be unfair to give Koreans who can afford to make overseas trips opportunities to buy duty-free items, while Koreans who cannot afford to go abroad have to pay taxes on those products.
The Finance Ministry also said duty-free shopping in the arrivals zone would make the baggage claim process longer and customs areas more crowded, which would inconvenience passengers.
Despite these concerns, industry watchers said the real worry of the Finance Ministry was loss of tax revenue amid a rising number of outbound Korean travelers.
According to the Korea Tourism Organization, despite the protracted slump in domestic consumption, the number of outbound Korean travelers hit a record high of 7.23 million for the first half of this year, a 9.6 percent rise from the same period last year.
By Seo Jee-yeon (jyseo@heraldcorp.com)
