Superrich children earn more in dividends than adults: data

Underage heirs of affluent families have been earning more dividend income than the average adult shareholder in recent years, data showed Tuesday.

According to data submitted by the National Tax Service to the parliamentary strategy and finance committee, 303,197 adult shareholders were reported to have received stock dividends of 20 million won ($17,800) or more from 2013 to 2015.

The aggregated amount stood at 28.6 trillion won, with the average amount per person lingering around 94 million won.

The per capita amount was higher for shareholders aged under 19, who earned 122.5 million won on average during the same period, with 1,693 reported beneficiaries receiving 200.7 billion won in total.

Rich minors also turned out to be making more real estate profits, garnering 20 million in average annual lease income, higher than 19 million earned by adult landlords.

“Considering that a dividend amount is equal to some 10 percent of a given stock value, these minors presumably inherited considerable wealth from their families,” said Rep. Kim Du-kwan of the ruling Democratic Party of Korea.

Though the donation of stocks is in itself legitimate, there is a need to revise the lopsided wealth distribution in which a small group of rich children earn more than most adults, according to the lawmaker.

“The tax office should make a thorough review on the stock, deposits and other assets of the superrich so as to prevent possible cases of tax evasion,” he added.

The proportion of stock-rick children was especially high in family-run conglomerates where group owners sought to minimize inheritance tax.

In nine out of the 24 business groups which are subject to cross-shareholding bans, underage children of group owners were registered as possessing the stocks of the conglomerate’s affiliates as of May this year, according to data submitted by the Fair Trade Commission. The total value of their stocks totaled at 4.1 billion won as of the end of September, data showed.

By Bae Hyun-jung (tellme@heraldcorp.com)