[Editorial] When Local Gov't Encourages Tax Resistance

The neighborhood government of Seoul's Gangnamgu is in trouble for passing out printed material that seems to encourage its citizens to refuse to pay "comprehensive real estate tax." In the November 28 edition of its newsletter Gangnam Kkachi Sosik, it says that if residents pay by the deadline of December 15, they then cannot apply for legal relief, such as the filing of lawsuits. In context what that seems to mean is that if the case Seoul's neighborhood government heads filed with the Constitutional Court last July goes in their favor, or if the same court finds that particular tax to be unconstitutional, then anyone who has already paid up won't get his money back. Gangnamgu has the highest density of citizens who have not paid their "comprehensive real estate tax."

There are two problems here. To begin with, the government there should have thought about the effects of what it was saying. It is fair to assume that a considerable number of people who had intended to pay their taxes read what neighborhood officials had to say and then decided not to. The second issue is one of accuracy. The National Tax Service (NTS) says that Gangnamgu's information is preposterous. Gangnamgu seems to be thinking of how after the "excess land gains tax" was found unconstitutional a very many people never got their money back, but the Basic Law on National Taxes has been revised since then. The NIS says that since 1994 a system is in place in which you can file for corrections, so even if you report and pay all your taxes you can get them back if any of them are later found to be problematic. If neighborhood officials knew the system changed then they clearly are distorting the facts, and if they were unaware of the change they made a very serious mistake. At they very least they should have checked with the NIS.

The situation is more than a little serious if there was any intention of inciting tax resistance. Local self-interest can end up looking like an attempt the state's tax-levying authority. We hope that is not the intention, but at the end of the newsletter it says you can file to have the "comprehensive real estate tax" declared unconstitutional, so it is hard not to be suspicious. It is just supplying information, but it does look like it is suggesting that people file petitions with the Constitutional Court. It must not be allowed to evade this issue.

The Hankyoreh, 6 December 2005.

[Translations by Seoul Selection]