South Chungcheong Province Governor Kim Tae-heum stressed that nationally driven policies such as high oil price relief payments should be fully funded by the central government without burdening local budgets.
Kim stated his position at a leadership meeting held at the provincial government office on the 6th, responding to President Lee Jae-myung's social media remarks on the 5th regarding oil price relief payments.
"The central government's position is that this is a 'debt-free supplementary budget' utilizing excess tax revenue from increased corporate tax and securities transaction tax collections, but local governments are actually seeing local tax revenues decline due to the real estate downturn, making it very necessary to replenish local finances," Kim said. "It is appropriate that nationally driven policies for stabilizing people's livelihoods, such as high oil price relief payments, be fully funded by the national budget."
Kim's position is that increased local share tax allocations are essentially an early disbursement of settlement funds that would normally come down the following year after national tax settlement, making it difficult to view them as a genuine replenishment of local finances.
"If the settlement funds were distributed through normal procedures, local governments could use them autonomously for projects suited to regional conditions, but by being allocated through this supplementary budget, their use is being restricted to supporting central government programs," Kim said, expressing concern.
"The intent to revive people's livelihoods must not become a tool that pressures future local finances through an 'advance-payment supplementary budget,'" Kim added. "There is a need to consider directing excess tax revenue toward supplementing local fiscal conditions."