지방자치단체 재정 자립을 위한 세제 개선방안에 관한 탐색적 연구

Abstract

This report investigates tax assignment of central and local taxes in Korea. The Central Government has the authority and has the right to impose taxes on the local residents. Governmental taxes are collected to fund local government projects which benefit the local community. We found many small－sized local governments in Korea have suffered from financial bottleneck and have not been able to receive sufficient financial support from the central government. This study primarily deals with issues surrounding the impact of national fiscal policy and the regulatory framework on local governments’ tax authority. Based on the potential implications of local taxation circumstances, we suggests three implemental alternatives for improvement of tax revenue imbalance among local governments. First, we suggest to change Comprehensive Real Estate Holding Taxation authority from central government to local. Because local citizens own the title of real estates, the taxation authority of real estate holing tax should be given to local governments. Second, in the same assumption of Comprehensive Real Estate Tax, we propose to assign a portion of VAT to local governments. Third, because capital gain tax imposed on the disposal of property is a tax in accordance with the nature of local taxes, we suggest to transfer tax authority from national tax to local tax. This study is different in suggesting autonomous finance realization methods of local governments by restructuring of local income tax system, introduction of local consumption tax, and giving of local governments’ taxing authority of real estate sales taxation.