S. Korea lowers tax revenue prediction on global recession

SEOUL, Nov. 20 (Yonhap) -- South Korea's internal tax revenues next year are expected to fall short of an earlier prediction as a global economic recession may affect household income and corporate profits, the government said Thursday.

In a budget plan recently submitted to parliament, the Finance Ministry forecast
that the nation will bring in an estimated 143.65 trillion won (US$99.3 billion)
in internal tax revenues next year, down 2 percent, or 2.9 trillion won, from an
earlier projection.
The ministry lowered income tax predictions by 3.7 percent to 41.3 trillion won,
while forecasting corporate tax revenues will drop 3.5 percent from an earlier
projection to 37.88 trillion won.
The adjustment comes as South Korea is gripped by growing jitters that prolonged
financial instability stemming from the U.S. could send the global economy into a
recession.
On Nov. 3, South Korea revised its budget plan under which it sought to increase
spending by 10 trillion won to 283 trillion won, a move aimed at boosting the
slumping domestic demand and corporate activities.
Exports, the backbone of the nation's economic growth, seemed to be taking a
beating from the global financial turmoil.
In the first 10 days of this month, exports plunged 26.3 percent to $9.87 billion
from the same period a month before, government sources showed. If the decline
continues, it will mark the first monthly contraction in exports since September
last year.
The ministry forecast South Korea's economy to grow around 4 percent next year.