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(LEAD) Gov't working on measures to ease income inequality: finance minister

All News 17:33 June 07, 2018

(ATTN: ADDS more details in last 2 paras)

SEOUL, June 7 (Yonhap) -- The government is reviewing a set of measures to help ease widening income inequality, the country's chief economic policymaker said Thursday.

Real household income increased sharply in the first quarter of 2018 from a year earlier, but the disparity in earnings worsened, government data showed.

The average household earned 4.76 million won (US$4,400) per month in the January-March period, jumping 3.7 percent from a year earlier, according to Statistics Korea. The on-year growth is the quickest since the first quarter of 2014, when the figure was 5 percent.

The monthly average income for those in the bottom 20 percent income bracket, however, dropped 8 percent on-year to 1.28 million won, the sharpest drop since 2003, when such data began to be compiled. In contrast, households in the upper 20 percent income range earned 10 million won during the first quarter, up 9.3 percent from a year earlier.

The Moon Jae-in government is seeking income-led economic growth, and widening income inequality is one of the thorny issues facing the administration.

"If necessary, the government may consider next year's budget and tax policy (to tackle the matter)," Finance Minister Kim Dong-yeon told reporters before a meeting with presidential aides and economy-related ministers to discuss deepening income inequality.

The minister said widening income equality is not an issue that can be resolved quickly as it stems in part from structural problems.

"The government thinks that it is a grave concern ... and the structural factor could further worsen the income inequality," Kim said, adding that the drop in the bottom bracket partly stems from a rise in aged heads of households, contraction in employment in the low-income bracket and a slump in the retail sector.

"We need to take effective measures to deal with the issue, with tailored policies to be rolled out," the policymaker added.

This undated file photo shows Finance Minister Kim Dong-yeon. (Yonhap)


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