Also the communication fee tax credit

The "tax credit for telecommunication expenses," which was considered for the purpose of easing the burden of household telecommunication expenses, has recently come to the surface again. Related bills have been proposed several times in the National Assembly, but an agreement has not been reached. However, as the recently launched Lee Jae-myung government is making a strong drive again, some predict that it can be carried out this time.

According to related industries on Thursday, Lee Hae-min, a member of the National Assembly's Science, Technology, Information, Broadcasting and Communications Committee, proposed on June 25 a partial revision bill of the income tax law (the Communications Cost Tax Credit Act) to ease the burden of telecommunications expenses for the entire nation. Ordinary households can receive a 15 percent deduction of their annual expenditure and telecommunications expenses, and the digital vulnerable, including the disabled, can receive a 25 percent preferential deduction rate.

Earlier, President Lee Jae-myung made a pledge to deduct telecommunication expenses when he was a presidential candidate. The government plans to allow a certain portion of monthly telecommunication expenses to be deducted for the workers themselves, their children, and elderly parents aged 65 or older.

Last year, the National Assembly brought up the communication cost tax credit card several times as one of the measures to cut household communication costs. Cho Seung-rae (Democratic Party of Korea) of the National Assembly's Strategy and Finance Committee set a limit of 150,000 won per year in June last year, including 15% of mobile communication service fees spent by residents with earned income and basic deductions (minor children, parents, etc.).

Lee Won-taek, a member of the National Assembly's Agriculture, Food, Maritime Affairs and Fisheries Committee, also proposed a partial revision of the income tax law in November last year that would deduct 6% of mobile telecommunications fees from the total income tax.

However, lawmaker Cho's bill was pending at the tax subcommittee of the National Assembly's Strategy and Finance Committee as of the 3rd, and lawmaker Lee's bill was submitted to the committee in April this year, but has not been processed.

"The Ministry of Strategy and Finance views the issue as conservative as it is a tax case rather than a result of a dispute between the ruling and opposition parties," an industry source said. "As the new government has set it as a pledge, it is expected that the discussion will be conducted as soon as major pending issues are concluded. I think it is positive."

Some in the industry point out that the burden of reducing fiscal income and the issue of equity with tax-free people, including low-income people, should be resolved first

The Ministry of Science and ICT reported on pending issues to the National Planning Committee last month and said, "When tax credits are applied, 33.6% of tax-free people, including low-income people, are practically excluded from the policy," adding, "Fiscal income is expected to decrease by a total of 7.9455 trillion won from 2026 to 2030."

Still, the industry believes that it is a necessary system in that it can increase consumer utility. An official from a telecommunications company said, "If tax credit is implemented from a consumer's point of view, it will not be bad. Wouldn't the Ministry of Information and Technology deal with the issue before the end of this year?"

fun3503@chosunbiz.com