All the knowledge in the world, understanding, yes, please introduce the following order. Sure, I will. Next, Reporter Baek Jong-hoon has prepared a story about inheritance tax. Understand, reporters usually get criticized for bringing up issues that are likely to receive backlash, but still, let's hear about this inheritance tax issue. Okay, let's hear it. Welcome. Regardless of the ruling party or the opposition party, there have been discussions about reforming inheritance tax lately, so I brought some news about it. The government is planning to propose a comprehensive tax reform plan next month, as the time to revise it is approaching. Chairman Jeong Jeong-sik of the Policy Committee of the People Power Party mentioned that the average price of an apartment in Seoul is 1.29 billion won, so there is a need for some reform since only Seoul apartments alone could incur inheritance tax when passed on to the next generation. In situations like this, the opposition party often does not respond positively.

Lim Kwang-hyun, a former National Tax Service official and current deputy floor leader of the Democratic Party, said that it is necessary to review the part where the middle class has seen an increase in tax burden. If you take a look at the slide for a moment, he simply mentioned that even though the middle class did not do much, they are being burdened with increased numbers. In the speech made on the 4th, the official prices increased by over 19% in 2021 and 17% in 2022. Looking at the slide here, between 500 million won and 1 billion won, the number of taxpayers subject to taxation has increased by nearly 50%. Compared to two years ago, it has increased by about 50%, and the determined tax amount has also increased by 68% over the past two years. Therefore, some reform is needed, especially mentioning the deduction part. Since it was determined by Japan in 1997, it has been a one-time deduction from the total property when the line is crossed at 500 million won.

If you say you are stopping now and say that adjustments are needed, you always deduct 500 million won. That's right, deduct it unconditionally. If you don't choose child deductions as a consistent deduction, you deduct it directly as a family deduction. Now, with the rising cost of living and real estate prices going up, internally, we are considering raising it by around 6 won. This is, let's say, the real inflation rate. Really, when we eat jajangmyeon for 3,000 won, every time, the ruling party and the opposition party agree. If the law doesn't change, unfortunately, those who happen to inherit at that time will pay a lot of taxes. Then, when the law changes due to public opinion, those who pay afterwards will pay less. What is this? This is, of course, the concept of inflation that is embedded in the entire nation, right? So, that's how it should be done. When giving gifts or inheriting, that kind of thing.

When parents and children exchange money, even in those cases, when they ask how much it is, they always refer to the Bank of Korea's benchmark interest rate. They say, Add a bit more on top of that. However, the problem is that since the amount is included, tax rates and other factors are also considered, making it difficult to keep up. Therefore, as mentioned earlier, there seems to be an issue with determining the amount each time. Going beyond the strength of the nation, the ruling party suggests changing the focus to the amount received per individual in inheritance, as many tax experts and professionals have suggested calculating the acquisition tax per individual. They also propose adjusting the gift tax on stock increases. Additionally, they are considering improving the gift tax on stock increases that are occasionally mentioned. So, basically, if you take a quick look at the slides.

Now, this is a table that appears frequently in economic media. It shows the highest inheritance tax rates among OECD member countries. The institution with the highest tax rate is, uh, our country, which is relatively high after Japan. Here, this is the tax base and tax rate specified in Article 26 of our inheritance and gift tax law. So, the ruling party is saying that some changes are needed in deductions and that the tax rates need to be adjusted. What is the difference between the ruling party and the opposition party on this issue? On that point, on the other hand, they oppose it. Yes, the difference between the ruling party and the opposition party is, again, as follows: the opposition party is suggesting a slight increase in the standard deduction amount, while the ruling party is proposing to completely change the method of determining the tax based on the inheritance received per individual, and to abolish the major shareholder surcharge system. Additionally, if I may add one more thing, they are suggesting further expansion of tax deductions for inheritance in small and medium-sized enterprises or family businesses.

So, the number of people who pass away each year is around 350,000. Among them, those who pay inheritance tax amount to about 4.5% as of 2020. But you might not get the sense of it. In 2019, among those who passed away, there was a case where our house had to pay inheritance tax, about 2.4% of one house. For example, out of 100 people, two people. So, in the past three years, as real estate prices and living expenses have risen, the deduction amount has decreased, resulting in more households paying inheritance tax. It's commonly said that it's increasing. So, it's increasing, and the amount of inheritance tax has increased from 250 trillion won in 2018 to 490 trillion won in 2021. Therefore, even the opposition party has expressed its intention to increase the deduction amount at least. However, it seems that there will be heated debates on inheritance tax reform in the summer or fall. It seems that the opposition party agrees to increase the deduction amount, but...

The grandfather who left 10 billion won in inheritance suggests that if he has ten children, each child would receive 1 billion won, so let's just pay the inheritance tax for the 10 billion won. Currently, regardless of the number of children of the grandfather or grandmother, they just tax the entire estate directly. Um, that's what the red party is advocating, and the blue party still doesn't understand it well. So, what the program you just mentioned earlier will show on the slide might make you feel more realistic. If you look at a lump sum and first tax it, then go out, it is the old way of inheritance tax system. If it's an inheritance acquisition tax system, you divide it first and then calculate the tax amount for each individual, that's the concept of collecting it. The acquisition tax system seems more reasonable, it's intuitive and generally easier for individuals to accept, it's a bit easier to accept emotionally as a method, so, OECD.

Based on the criteria, in countries like South Korea, the United States, and the United Kingdom, inheritance tax is calculated on a per capita basis, as journalist Jang Sun-won mentioned. However, many countries such as Japan, Germany, France, and Italy calculate taxes based on individual inheritance acquisition. So, why does inheritance tax seem reasonable, and many countries follow that method? South Korea still calculates inheritance tax based on the total amount. Initially, influenced by the United States, many countries did not readily accept the legalization. Let me explain the advantages and disadvantages of calculating inheritance tax on a per capita basis. Therefore, when looking at the pros and cons of the latter method, the advantage is that each person pays taxes based on their own, their children's, or their family's standards, which is fair.

There are some effects that are more suitable for legal sentiment, and if several people inherit, there can be quantum and many siblings, but the advantage is that there can be redistributive effects or even subsidiary effects. The disadvantage is that it's not necessarily all advantages, but what I have prepared is that the National Tax Service examines whether it is appropriate for each individual to receive that amount, which is costly and cumbersome. It's cumbersome, yes, cumbersome. And in Japan, as mentioned by Kangnam-gyu, a lawyer at the last Law Firm CEO, in Japan, there was a side effect of tax evasion by giving quantum in a common way, dividing it into many parts, and then trading in cash. So, nowadays, can't we track and trace various things later on? Tracking between parents and children.

How can we view all of these transactions administratively? Oh, we know how much cash is being withdrawn these days. I don't understand what to do about that. Anyway, I understand. Numbers 1 and 2 are not convincing. For example, in the case of assets, even if, for instance, in the understanding session the other day, let's say, if a parent bought a house in Australia for their children several decades ago, if such things were done decades ago, even if the National Tax Service investigates diligently for ten years, it is difficult to track down assets that have been dispersed over a longer period. Inheritance tax itself is already difficult, but will it get even more difficult if it changes? If a grandfather has hidden foreign assets, for example, calculating the entire grandfather's estate and paying inheritance tax on it, whether it's an estate tax method or dividing it by the number of the grandfather's children for inheritance acquisition tax.

Regardless of the method, it's equally difficult to uncover overseas escape assets, so it won't get any harder by doing that. Why do you argue like that? Right now, I can't provide an accurate explanation all of a sudden, but first, analyzing the advantages and disadvantages mentioned in the OECD report, some people argue like that. It seems a bit strange that I can't give a precise answer all of a sudden. So, in 2019, the ruling party keeps insisting, which may seem politically motivated, but even in the previous government in 2019, there was an announcement suggesting that restructuring through inheritance tax reform, as the Presidential Committee on Financial Reform also suggested. It doesn't make sense at all, in terms of administrative costs; that's the job of the National Tax Service, which is already computerized, so it seems possible to handle other taxes in the same way.

It's about creating false quantum relationships. If you track it well, you'll know what it is. When it comes to tracking overseas assets buried somewhere, that's something the tax office should always be concerned about. Changing this system doesn't necessarily make it harder. For example, it seems correct to point out a 2% decrease in case number 3. In the case of quantum, as they say in Gangbyeon, it became a social issue in Japan. There are concerns about backdoor deals, but quantum is just acknowledged. If they don't divide it when they should, you can simply say, What about quantum? So, showing you the next slide, just explaining verbally might not be clear, so I've prepared. Mr. Park Jung-soo, a tax accountant, analyzes that when the inheritance property is 3 billion won, and there are two children when the parent passes away and no spouse, the existing method, which is still in use now, is the inheritance tax method. So, first of all, 5 billion won out of 30 billion won.

I will immediately deduct the lump sum deduction I mentioned earlier. Then, in the tax table, it amounts to 25 billion won, so here, as I mentioned earlier, dividing it into three ranges: from 5 billion to 10 billion, from 10 billion to 30 billion. By multiplying the tax rate for each range, you will have to pay 840 million won. It's a lot, right? For example, if we promote a reform in the inheritance tax acquisition method, for the first child, with an asset value of 15 billion won, deducting the deduction amount for the child 1 and the deduction amount for the child 2, which are the same at 500 million won each, even if divided, the taxable amount becomes 12.5 billion won each. If you calculate the tax amount from 5 billion to 10 billion and from 10 billion to 30 billion, it will be 340 million won each, totaling 680 million won. So, ultimately, under the current method, you have to pay 840 million won in taxes. If we proceed with the reform, the tax amount will decrease. So, if it's 600 million won, when you calculate that, how much is the inherited property?

Therefore, there are also cases where the method of dividing by the number of children for inheritance tax can lead to paying more taxes. It can result in paying more in some cases. Yes, you saw it correctly. In the case of smaller amounts, it actually leads to paying more. And it forms a parabola. The next graph could be an exact example of that. The yellow solid line represents the heirs, meaning the children, when there are four children. Here, the horizontal axis represents the amount of property, the taxable amount, and the standard amount, while the vertical axis represents the tax rate. Ultimately, the tax rate paid by four children is shown on the yellow solid line. Between 3 billion and 5 billion won of inherited property, excluding the deduction amount, it is a simulation result that shows a significant maximization in that range. As you can see, as you mentioned, there are times when it is advantageous to separate and when it is advantageous. When there are four children, dividing the property between 3 billion and 5 billion won results in a very optimal outcome.

He mentioned that, so this is an analysis from the National Assembly Budget Office. Therefore, based on this assumption, if the inheritance tax system is reformed, there are concerns that tax revenue could be reduced by up to about 13 trillion won at most in a simulation. Currently, it is around 1 trillion won, or about 1.3 trillion won at most. Of course, this is the maximum scenario. Conditions may vary, and this is not the final result, but rather a simulation. So, now that I've mentioned it, if I explain it, if you look at the slides, there are some concerns raised by some lawyers that taxing inheritance from spouses may not be fair, as it skips a generation. Some lawyers have raised this concern, and I inquired about it on Sunday, but Professor Ahn Chang-nam also mentioned that spouses are people who build assets together.

The Civil Code includes family law, but even though it's not skipping a generation to the spouse, inheriting inheritance tax is a bit questionable academically. Professor Ahn Chang mentioned that there are tools like deductions, but there are some aspects that don't seem right. Even when dividing property through divorce, no taxes are imposed. So, academically, there are some doubts about imposing inheritance tax on spouses. Currently, whether it's the husband or wife, divorcing just before death is a way to reduce inheritance tax. That's right. You resist by doing that. So, before passing away, if you divide the assets through a divorce, there is no tax, but if you pass away and then divide something, the tax increases. Of course, there are deductions, but tax experts are saying that these things are somewhat problematic and unreasonable.

I should have changed it earlier. When only a very small number of people pay inheritance tax, whether it is unfair or not, you should handle it yourselves. We left it unattended, but yes, when the majority starts paying, then people start to say, Hey, isn't this a bit unfair? It's quite cowardly and embarrassing to start finding it unfair. What I mentioned earlier comes to mind. There are about 350,000 people who pass away each year. Initially, in 2019, it was around 2-point-something percent, and now it has risen to 4.5%. If we calculate it in numbers, around 6 to 7 thousand people used to pay inheritance tax annually, but now it's around 14,000 to 15,000 people. And most of them are middle-class families in Seoul and the metropolitan area who have inherited homes from their ancestors. So, I think the politicians have somewhat considered the sentiments of these people. Anyway, even if it's unfair, even if one person suffers unfairly.

It should have been fixed. Just ignoring it when a few people are treated unfairly and then changing it considering public opinion when the numbers increase is strange. Really, so if I show you the next slide, changing it to an inheritance acquisition tax from the current gift tax is concerning because it's something expected. Last year, the taxes were less collected than the expected 56.4 trillion won, so the Ministry of Economy and Finance was in deep trouble. They call it a tax crunch. Even this year, until April, the tax revenue is 8 trillion won less collected. So, the Democratic Party is only suggesting a slight increase in the deduction amount I mentioned earlier. They disagree with what the ruling party is advocating, such as increasing the tax on inheritance and major shareholders, expanding the targets for business inheritance deductions. They are not particularly in favor of changing the inheritance acquisition tax system. Therefore, there are concerns about tax revenue crunch.

I am talking about a proposal. I called the office of Jin Sung-jun, the head of the Democratic Party's Policy Committee. We need to precisely address the issue of the gift tax and then consider creating a TF. It seems that we need to be a bit more forward-looking, as the Deputy Speaker mentioned earlier. Therefore, regarding the business inheritance system, you may wonder what it is. The business inheritance deduction is a system where, when a long-standing business is passed on to children, the taxes are reduced. If the revenue is less than 500 billion won, it can be applied. Depending on whether the business has been managed for 10, 20, or 30 years, deductions of up to 600 billion won can be made. It is a system where you don't have to pay inheritance tax. That's right. Why shouldn't you pay it? The purpose of this is for small and medium-sized enterprises or certain businesses to pass on their ownership.

If you skip or the tax rate is a bit high, you know, in our country, it is a system to prevent those kinds of things, so there are conditions instead. If you look at the slide now, it says that large companies are not eligible, but small and medium-sized enterprises with less than 500 billion won in sales are eligible. It is said that differential deductions are made each time the inheritor's deceased predecessor managed for more than 10 years, 20 years, or 30 years. There are also post-conditions. It is required that the inheritor's children must run the business for more than 5 years after inheritance, and it is also a condition that if more than 40% of the business assets are disposed of after receiving the inheritance, it is not allowed. After inheriting, it is not allowed to close the business for more than 1 year. Under these conditions, depending on the management period of the deceased predecessor, some inheritance tax deductions are given. Inheriting and continuing the business of the deceased predecessor is something that is recommended in Korea, which seems to be the purpose.

However, why did everyone go crazy when Lee Jae-yong was to inherit the management rights of Samsung? Why is it that when large corporations inherit, it's not allowed, but when small and medium-sized enterprises inherit, it is encouraged? You might ask such a question. Well, this system actually originated in Germany. As far as I could find out, in Germany, it is known that there are more small and medium-sized enterprises than large corporations compared to South Korea. Therefore, in Germany, the system of inheriting businesses is well established. Currently, in South Korea, there are about 200 companies using this system annually. On average, however, in Germany, about 10,000 companies per year are transferring their businesses through the system of inheriting small and medium-sized enterprises. So, you can consider that this system was adopted from Germany. So, what is the concept of inheriting businesses in South Korea? Yes.

When criticizing inheriting a business, does it make sense to select the sons of the national football team players when choosing the national football team representatives? Is this a very clear logic? When passing on small and medium-sized businesses, why is the logic that says, Oh, you should inherit the business, going back and forth based on a sales of 500 billion won? What is the reason for inheriting less than 500 billion won in sales being desirable and inheriting more than 500 billion won being undesirable? Of course, I'm not asking reporter Park Jung-ho this question, but we always respond in this way when facing all problems emotionally. If someone seems very wealthy emotionally, we just want to criticize and attack them. If they are just described as a small and medium-sized business, then it's like, Oh, they are working hard. Then, if we say we should help, it means inheriting a business.

It seems like we need help with inheritance, so the context is going back and forth. Such criticism seems possible. However, as I keep mentioning, in Germany or the UK, this system has been in place for a long time. Especially in Germany, they have been applying it properly for over a million cases annually. So, I think this concept may not be wrong. Even though I haven't delved into the purpose of enacting this law, in the case of small and medium-sized enterprises, there are various factors that can destabilize the business if it is not passed down to the next generation. Therefore, I am thinking that the government should provide some support to enable small and medium-sized enterprises to operate continuously. Yes, I also think so. I don't know who asks such unnecessary questions. Small and medium-sized enterprises should be allowed to be inherited by the next generation. Who would disagree with that? Then, the son will not...

If you do that, it becomes a controversial issue. Inheritance tax, there is actually no correct answer to this issue. So, there are countries with an inheritance tax rate of 60%, and there are also countries in the OECD with no inheritance tax. Well, usually taxes are similar in each country, but inheritance and gift taxes are extremely different from country to country. So, it's not easy to say what the right answer is. There are other ways to explain it now, like capital gains tax. In some Eastern European countries, they impose taxes when the inherited property is disposed of, instead of taxing it when the deceased passes away. So, in reality, if you inherit a house your father bought, you have to pay inheritance tax, but when you inherit, for example, a 3 billion-won apartment, even if your father bought it for 1 billion won, you don't pay transfer tax on the difference of 2.9 billion won, and the children also.

It's guidance, isn't it? That's right, so actually, that's a bit strange. Inheritance tax, well, it's okay not to pay inheritance tax, but if your father bought it for 100 million won, when you sell it later for 500 million won, you should pay transfer tax for 490 million won. So, it seems reasonable in a way. You have to pay one of the two taxes. It's frustrating, right? Why am I the only one being criticized? I think the main idea has been conveyed. Yes, that's correct. I will definitely convey that. You might think about why the tax laws are being revised every year and the government proposes it and then it gets rejected. The solution is, if a government can easily adjust tax rates and deductions through enforcement decrees, without democratic control, it is considered undemocratic, which is why the people's consensus is important.

As the National Assembly controls, sometimes, in the end, when there are things that need to be fixed, they cannot be fixed, or they fix things that don't need fixing. It seems like there are cases like this. I think that giving the three powers to the National Assembly reflects the spirit that the will of the people is reflected in that place called the National Assembly. For the National Assembly to be an institution of the people's will, the right to nominate should be in the hands of the people. Since the right to nominate is in the hands of the leaders of the two parties, if they select the members of the National Assembly, it becomes the institution of the will of the leaders of the two parties, not the people. I heard someone saying something like that somewhere. It's a bit strange, right? There are many strange people. Where are they saying such things? It should be an institution of the people. Thank you, Reporter Baek Jong-eun. Thank you.

상속세 개편 최신 업데이트 (언더스탠딩 백종훈 기자)

📣 사람을 찾습니다
🙋 언더스탠딩과 함께 일할 분을 찾습니다!

직무: 영상제작PD, 기자, 인사담당자, 마케팅담당자 
지원 접수: 이메일 접수 to.understanding.official@gmail.com
제출 서류: 이력서, 포트폴리오
접수 기간: 상시채용


라이브는 삼프로TV에서, 클립영상은 언더스탠딩에서!

매일 저녁 7시~9시

문의 : to.understanding.official@gmail.com


상속세 개편 최신 업데이트 (언더스탠딩 백종훈 기자)

Scripts