Securities transaction taxes levied on state pension to top 30 trl won

SEOUL, Sept. 18 (Yonhap) -- Securities transaction taxes levied on national pension funds may exceed 30 trillion won (US$27 billion) in the next 30 years, which can hurt the health of the social welfare system down the road, a lawmaker said Sunday. Rep. Joo Seung-yong, of the opposition Democratic Party (DP), said at the present pace, taxes levied on the selling of buying of stocks with state pension money, can reach 1 trillion won in 2040 alone. He based his claim on data provided by the National Pension Service (NPS) ahead of the parliamentary audit planned for this week. "If all the taxes slapped in coming years are added up, the total will easily exceed the 30 trillion won mark," he claimed. He pointed out that of the 324 trillion won in the fund controlled by the NPS in 2010, 55 trillion won were invested into stocks, with the securities transaction tax reaching 89.5 billion won. It said that for this year, the total should exceed 130 billion won, with the amount to go up steadily in the future. Seoul said it plans to increase the proportion of state pension funds invested in the local stock market from 17.6 percent at present, to at least 20 percent in the future. Joo said that collecting transaction taxes from the pension fund is wrong, since the national pension fund is classified as non-taxable assets under the country's law, and because the money will be used to support welfare payment for the public. "The people are the owners of the pension fund, with the country in charge of investing money to generate profit, so it does not make sense to levy transaction taxes," the DP lawmaker said. He called for a revision of the existing rules that tax the pension's stock transactions.