The 1948 Establishment of Government and the Reform of Taxes in the Korea War
Authors:   KOREAN SOCIETY OF TAX LAW, Suh Jungwoo 
Published: February 2025

Research topics: I think the Korean tax history is of great practical significance as we realistically carry out tax or tax administration. Whenever we encounter various difficult tax or cleaning problems, large and small, we take a step back and eventually rediscover that it is a historical problem in the past history. This study aims to study the fiscal and tax reforms at that time, focusing on the establishment of the government and the period from 1948 to 1960, before and after the Korean War.
Research background: The Korean economy, which had been moving toward economic stability and balanced finance since the establishment of the Korean government, unexpectedly encountered the Korean War, frustrating all stability and growth development policies and forcing a new exhibition system. According to the basic structure of tax administration after the ceasefire, the government implemented an indirect tax-centered tax system by lowering the overall tax rate from the wartime tax system to the usual tax system, promoting capital accumulation, suppressing consumption, and simplifying tax administration to avoid friction with taxpayers. Only when we understand the implications of real taxation and tax administration issues that have been developed throughout history for the coming history will we be able to have a historical consciousness of our mission.
Differences from prior research: Among Korean tax history, this study studies the establishment of the Korean government in 1948, the Korean War from 1950 to 1953, and fiscal and tax reforms from 1954 to the April 19 Revolution in 1960, which is different from previous Korean tax history studies.
Research method: Focusing on literature research methods among social science research methods, this study studied and drew implications for fiscal and tax reforms from the establishment of the government in 1948 to the Korean War and ceasefire, and 1960.
Research results: At the same time as the establishment of the Korean government on August 15, 1948, the military government budget was finally settled at the end of September of that year, and the independent government's fiscal policy was implemented from October 1. The government set economic stability and industrial revival through inflation as economic policy goals, and as a result, tried to realize a balanced budget. Since the foundation of the country, the Korean government has inevitably expanded expenses due to emergency projects such as securing security, strengthening national defense, increasing electricity and food production, and implementing compulsory education, making it impossible to establish a balanced budget. Recently, the public is dissatisfied with the level of tax burden and tax and tax administration. As such, when grasping the current level of tax burden in Korea and how tax and tax administration issues are thrown before us throughout the history process so far, we will be able to find the basic direction of solving the problems of tax burden and tax administration.
Contribution points and expected effects: Recently, public dissatisfaction with the level of tax burden and tax and tax administration is high. As such, when we grasp the level of tax burden and how the current tax burden and tax and tax administration issues in Korea have been thrown before us so far, we will be able to find the basic direction of solving the problems of tax burden and tax and tax administration. We will be able to have a historical consciousness of our mission only when we find out what the real tax and tax administration issues that have been developed throughout history mean for the future history.