Pusan confirms 5 more years of container tax

The City of Pusan confirmed on November 23 that it would collect the container tax for five more years until the end of 2006. The Korea International Trade Association (KITA), however, it is still vehemently opposing it.

The City of Pusan submitted a revised municipal ordinance to the Pusan city council to extend the container tax until the end of 2006. The container tax was originally scheduled to expire at the end of this year according to the current city ordinance.

The revised local ordinance shortens the extension to five years from the originally proposed ten-year extension. The downwardly revised taxation period is largely viewed as a concession to KITA.

If the revised ordinance is promulgated through the deliberations and decision of the city council, the City of Pusan will take in an estimated 384 billion won during the five years.

The tax will be used by the City of Pusan to complete several highways in the hinterlands (five routes of 48.52 km are currently under construction) by 2005 and another as yet unstarted route (the Oncheon-cheon highway) by 2008.

The City of Pusan decided to cooperate with KITA and call on the government for assistance instead of shortening the taxation period.

The city is also planning to reveal a quarterly breakdown of income and expenses through the Internet.

A working level official at KITA insisted that the City of Pusan must abolish the container tax considering the current economic environment and how the tax will create an inordinate burden for trading companies. A civil officer from the City of Pusan responded, "We reduced the taxation period by five years to the end of 2006, when the first phase of the Pusan New Port plan is complete. We decided on the period after two hearings and reviewing the legislative notice."