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(4th LD) Parties scramble to bridge differences over 2018 budget bill

All Headlines 16:44 December 02, 2017

(ATTN: CHANGES headline, lead; REWRITES throughout with new info)

SEOUL, Dec. 2 (Yonhap) -- Rival parties on Saturday made last-ditch efforts to reconcile differences over the government's spending plan for next year, as the legal deadline for the budget approval drew near.

From the morning on, top negotiators of the ruling Democratic Party, main opposition Liberty Korea Party (LKP) and People's Party struggled for hours to compromise over the 429 trillion won (US$395 billion) bill designed to create jobs, improve public welfare and spur growth.

Under Thursday's cross-party agreement, the budget bill was sent to a parliamentary plenary session at noon Saturday -- a step to prepare for a floor vote. The full-house session, originally set for 2 p.m. Saturday, was rescheduled for 9 p.m. to give more time for negotiations.

The constitutional deadline for the budget passage is Saturday.

Later in the day, the parties planned to hold general meetings of their lawmakers for internal talks over the negotiations. Their top negotiators will meet again at 6 p.m. for the eleventh-hour negotiations.

Top officials from the three major parties hold talks to narrow differences over the government's 2018 budget plan at the National Assembly in Seoul on Dec. 2, 2017. (Yonhap)

Major bones of contention are a proposal to use 534.9 billion won to support Moon's push to create 174,000 new public service jobs by 2022 and the 3 trillion won "job stability" plan to bankroll next year's minimum wage increase.

During the negotiations, the three parties wrangled over how much they would scale back the initial plan to increase some 12,000 public-service jobs next year. The LKP offered to halve the number, a demand unacceptable for the ruling party.

Regarding the job stability plan, opposition parties demanded it be applied for only one year. The government and ruling party balked at it.

Another sticking point was the ruling bloc's push to increase tax rates for top-earning individuals and businesses. Opposition parties demanded that the proposed income tax rise be introduced in 2019 rather than next year.

The original tax reform bills aim to raise the corporate tax rate for businesses with a taxable income of 200 billion won or more to 25 percent from the current 22 percent, and the income tax rate for individuals earning taxable income exceeding 500 million won to 42 percent from the current 40 percent.

The ruling party needs the opposition bloc's support for the budget passage as it has only 121 parliamentary seats, far short of a majority in the 299-member legislature.

The presidential office Cheong Wa Dae called on the rival parties to show "spirits of cooperative politics," noting that the bill concerns citizens' livelihoods and represents the president's philosophy for statecraft.

If the parties fail to meet the Saturday deadline with negotiations prolonged beyond the Jan. 1 start of the fiscal year the government would have to devise a provisional budget that can be used only for mandatory expenditures as stipulated by law.

sshluck@yna.co.kr
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