Cheong Wa Dae on Friday said discussions on tax reform will begin in earnest next week, amid controversy over President Moon Jae-in’s job creation and welfare expansion plans that critics say will eventually lead to a tax hike.

“It is early for the Presidential Office to discuss (the tax hike plan) in detail, since it is expected to be dealt with at next week’s meeting of economy-related ministers or the weekly Cabinet meeting,” Cheong Wa Dae’s spokesperson Park Soo-hyun told reporters.

President Moon chaired a two-day meeting on Thursday and Friday to shape his administration’s fiscal strategy for the next five years. Opening the meeting, the liberal leader proclaimed he prefers “a government that works,” to a small government. 

A 100-point policy plan for his five-year presidency, unveiled Wednesday, will require an additional 178 trillion won ($158.8 billion) in national budget, according to Moon’s de facto transition team which drafted the road map. Of the total, at least 82.6 trillion won would have to come from a next increase in tax revenues, the team has analyzed.

Further fueling speculation of a tax increase, Rep. Choo Mi-ae, chairwoman of the ruling Democratic Party of Korea, on Thursday openly called for an increase in taxes on top-group corporations and ultra-rich individuals. 

By Lee Sun-young (milaya@heraldcorp.com)