Ministries to brief Park on new policies

Economic-related ministries and agencies are preparing for their policy briefings to President-elect Park Geun-hye, starting with the Small and Medium Business Administration on Friday.

Next in line will be the National Tax Service, which is expected to brief and make suggestions on taming and regulating the underground economy, or the black market.

It has been conventional for the Ministry of Strategy of Finance to brief the team before the NTS.

Political analysts observed that the tax agency has been prioritized after the SME interest group as Park seeks an annual budget of 27 trillion won ($2.5 billion) over the next five years for welfare projects, while the president-elect seeks to draw a roadmap rather than introducing new policies.

It would be logical to secure funding by legalizing and levying taxes on private businesses in the black market, government officials said.

The NTS said that the black market is still roaming free from paying taxes, and that this must be dealt with.

The market size is estimated to be around 400 trillion won to 500 trillion won.

Park has suggested that Korea needs to strengthen its financial information system on the underground economy, enabling transparency of transactions for taxation. Unofficial currency traders, money lenders and gas distributors among others in the black market would be targeted and fall under government scrutiny.

The Ministry of Knowledge Economy comes after the NTS on Saturday, and its reports will likely include policies on SMEs, information technology, industrial exports and foreign direct investment.

Park is expected to review especially the ministry’s information technology unit as she has pledged to set up a control tower that can single-handedly manage policy on IT research and development in line with the vision to sustain the economy based on creative science and convergence technology.

Also, the ministry will reportedly speak on FDI projects including the establishment of foreign casino resorts to attract overseas capital.

The Fair Trade Commission will report on Jan. 15 presenting measures for strengthened regulations against unfair practices by conglomerates as Park pledged to clear out market imbalance undermining small businesses.

The Korean Communications Commission, meanwhile, is set to report on Jan. 16, and it is likely to suggest policies that can benefit consumers through lowered telecom subscription fees and phone bills, and allow more choices for data services.

By Park Hyong-ki (hkp@heraldcorp.com)