Discussions on increasing the departure tax are gaining momentum in the National Assembly. Following a reduction from 10,000 won to 7,000 won last July, which also expanded the exemption to children under 12, the tourism development fund has seen a significant drop in revenue. The tourism industry is expressing concerns that this decline is hindering improvements in accommodation infrastructure, workforce training, and regional tourism projects. With preparations underway for a projected 30 million foreign tourists, the need for stable funding is a valid point of consideration.
The tourism development fund is a key financial resource supporting tourism policy, with the departure tax accounting for about 30% of its revenue. According to data presented at the National Assembly meeting, revenue from the departure tax, which was approximately 400 billion won in 2019, is expected to fall to around 262.4 billion won this year. The industry estimates that the tax reduction last year resulted in a loss of about 130 to 140 billion won annually. Additionally, the burden of a 2.4 trillion won debt incurred during the COVID-19 pandemic remains a concern. Given that tourism plays a crucial role in domestic recovery and regional economic revitalization, it is unsustainable to continue weakening the financial foundation.
However, a lack of funds cannot be the sole justification for an increase. The departure tax is included in airfare, meaning it is ultimately paid by the public. Regardless of the amount, the purpose, usage, and outcomes must be clear. If the tax is to be raised again after being lowered for the sake of easing the public burden, it is essential to explain what has changed in the interim and how it will be managed differently moving forward.
The core issue is trust in the management of the tourism fund. Concerns that the public cannot easily verify how the funds are utilized or the outcomes of funded projects are significant. There have also been calls from academia to improve the structure, as a substantial portion of the fund is allocated to loans for tourism businesses. The role of policy financing is clear, but transparency regarding repeated support, restrictions on aid to large corporations, criteria for distributing funds to small and new businesses, and loan recovery rates must be more openly disclosed and verified. This transparency is crucial for convincing the public that their contributions lead to enhanced industry competitiveness and regional economic recovery.
International examples should also be examined carefully. Japan is pushing to increase its international tourism passenger tax, while Australia and the UK manage departure and aviation-related fees. However, the objectives of these systems often intertwine tourism promotion with border management, environmental concerns, and aviation policy. Simply comparing lower rates to those in other countries is insufficient. A rationale that aligns with Korea's tourism policy funding structure and principles of public burden is necessary.
If the departure tax is to be realigned, reforms to the fund must proceed at the same pace. Transparency in usage, performance evaluations for individual projects, criteria for loan support, disclosure of recovery rates, and restrictions on aid to large corporations are minimal prerequisites. Additionally, increasing the proportion of projects that the public and local communities can feel, such as worker vacation support, accommodation discounts, regional tourism safety nets, and improvements in reception capacity, is essential. Mechanisms to bridge the gap between payers and beneficiaries will enhance acceptance of the burden.
Tourism is no longer a secondary industry. It is a strategic sector that supports both attracting foreign visitors and boosting domestic consumption while addressing regional decline. Therefore, discussions on expanding funding are necessary. However, the order of operations is crucial; without proof of proper usage before seeking to collect more, the justification weakens. The success of discussions on the departure tax hinges not on the amount of the increase but on whether trust in the tourism fund can be restored.
* This article has been translated by AI.
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