SUMMARY ․ 163
SUMMARY
Study on Raising Source of Revenue for Balanced Development by Reorganizing Betterment Recapture System
Kim Jinbeom, Park Daehan, Lee Hyeongchan, Hong Saheum
This study aims to examine the necessity for expanding the source of revenue for balanced development and to prepare measures to improve the effectiveness of the betterment recapture system. More specifically, the purpose of this study is to present the necessity of expanding the source of revenue for balanced development by reviewing the special accounts on regional development and local governments’ financial conditions after the first phase of fiscal decentralization between 2019 and 2020 and then propose improvement measures for the target project and rates to be imposed in relation to the betterment recapture system.
Although population decline has been recognized as a national issue for a relatively long time in South Korea, local governments lack the budget to creatively and efficiently overcome this problem. Accordingly, to expand financial resources to promote countermeasures against the population decline problem, the system for development charges and the system for overconcentration charges were reviewed since they are among the sources of revenue for the regional support account for the source of revenue for balanced development.
Regarding the system for the development charges (in accordance with the Restitution of Development Gains Act), as development projects have been steadily on the rise since the introduction of the system, improvements have
164
thus been proposed for the purpose of introduction or the equity of burden.
Improvements were reviewed in line with the purpose of their introduction.
With respect to the projects subject to imposition, the inclusion of replotting methods for public housing projects and urban development projects was proposed for the short term, and then, a measure to expand to all development projects was proposed for the mid- to long-term. Results suggest that the imposition rates should be increased by 10% on a steady basis, and it was thus proposed that up to 50% of the amount borne be returned.
As for the overconcentration charges in the Seoul Metropolitan Area Readjustment Planning Act, this study proposed an improvement measure and a plan to introduce a so-called overconcentration tax for the target area and size subject to imposition that is more relaxed than it was at the time of the system introduction. In the first stage, the areas subject to imposition were expanded to overconcentration control areas in Gyeonggi Province and in the second stage, to the same areas in Incheon. The study proposes imposing a 5%
rate on the overconcentration control areas in Gyeonggi Province in the first stage and a 5% rate on areas in Incheon (including Incheon) and a 10% on Gyeonggi Province, similar to Seoul, during the second stage. The proposed size subject to tax is 3,000 m2,as proposed at the time of the system introduction, or 5,000 m2of the basic deduction area, which is a lower level. Parking lots that were being exempted were proposed to be excluded from this in consideration of encouraging the use of public transportation and alleviating urban congestion. Consider raising funds with a so-called overcrowding tax was proposed to resolve the continuous urban problem and unbalanced development in the metropolitan area based on the degree of overcrowding.
In addition, foreign cases were reviewed and proposed to determine the direction for expanding financial resources.
