By Lee Hyo-sik
Staff Reporter
Conventional wisdom holds that married couples with children pay less income tax than singles, with multiple-member households enjoying greater tax deductions.
But the nation's tax system still favors single-member households over married couples. According to the Korea Institute of Public Finance (KIPF) Sunday, singles are required to pay income tax when making over 795,000 won per month under the current scheme, 1.62 times more than the minimum monthly living cost of 490,800 won set by the government.
The tax exemption threshold for three-member families is set at 1.52 million won, 1.41 times more than the 1.08 million won essential for a month.
The larger the family size, the smaller the ratio of the tax exemption ceiling to the minimum livelihood expense becomes, meaning that multiple-member households pay more taxes than small ones in proportion to their minimum living costs.
``A single-member family begins paying income tax when earning over 1.62 times the minimum living expense. But a four-member household pays when making more than 1.31 times, indicating multiple-member ones shoulder a heavier tax burden in proportion to basic expenditures,'' a KIPF official said.
He said despite recent changes in government policies designed to provide greater tax benefits to larger households in promotion of childbirths, the tax system still favors singles and levies a heavier burden on multiple-member families.
In 2007, the government scrapped income tax deductions of 500,000 won and one million won for single-member and two-member households, respectively, while allowing families with children to deduct more expenses from taxable income.
From this year, salaried workers are allowed to deduct nine million won for a child going to university from their taxable income, up from the previous seven million, while deductions for kindergarten children through high school will be three million, up from two million.
leehs@koreatimes.co.kr
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