# South Korean local taxation reform efforts

> Live situation record from CLSTR: https://clstr.news/situations/south-korean-local-taxation-reform-efforts
> Updated: 2026-10-01T12:57:07.000Z. Sources: 4. Developments: 2.

South Korean lawmakers have introduced several legislative amendments aimed at reforming local taxation to increase fiscal autonomy and secure stable revenue for local governments.

The proposed reforms include increasing the local consumption tax rate from 25.3% to 40.3% of the value-added tax and establishing a new local corporate tax by transferring 5% of national corporate tax to local authorities. Additionally, the bills propose reallocating portions of tobacco consumption tax to fund firefighting resources. 

While provinces like Gyeonggi estimate these changes could secure approximately 14.1 trillion won over four years, the impact on other regions remains complex. For instance, in Jeju, the increase in local consumption tax revenue may be offset by a reduction in the total pool of national local allocation taxes.

## Timeline

### 2026-10-01: South Korean lawmakers introduce bills to reform local taxation

South Korean lawmakers have introduced six bills to reform local taxation, including raising consumption tax rates and establishing a local corporate tax to boost regional fiscal autonomy.

2 sources. https://clstr.news/cluster/south-korean-lawmakers-introduce-bills-to-reform-local-taxation

### 2026-09-29: South Korea debates Legacy 10 tax incentives for inheritance donations

South Korean lawmakers are debating a ‘Legacy 10’ tax incentive to boost inheritance donations to public interest corporations, while experts call for safeguards against tax avoidance.

2 sources. https://clstr.news/cluster/south-korea-debates-legacy-10-tax-incentives-for-inheritance-donations

---
Cite as: South Korean local taxation reform efforts. CLSTR, https://clstr.news/situations/south-korean-local-taxation-reform-efforts