The National Assembly Budget Office, in an effort to support the 19th National Assembly’s final settlement evaluation, has published the “FY 2011 Total Revenue Settlement Analysis” which is the fourteenth volume in the series of “FY 2011 Final Account Analysis Reports.”
This report aims to analyze 13 problematic issues in the 2011 total budget, consisting of 323.5 trillion won, by dividing it into tax revenues and non-tax revenues.

Issues of Tax Revenues are as follows:
- (Inaccurate budget compilation) overestimating transfer income tax by 15.0%, error in enlisting tax items in the case of value-added tax and carry-over tax revenue from 2011
- (Institutional reformation needs) limited effects of the Earned Income Tax Credit (EITC) due to reductions in payments by 8.0% and beneficiaries by 7.8%
- (Inefficient tax administration) increase in amount of deficit disposal in national tax arrears, low rate of offshore tax evasion collected (42.3%), increase in poor taxation

Issues of Non-Tax Revenues are as followings;
- (Inaccurate budget compilation) omitting the reformation effects of the social security contribution system when estimating the budget, not reflecting the 2 trillion won surplus of BOK’s budget
- (Tax revenue deficit) inadequate dividends of government financed industries, low demands of relocated public sector’s real estate, poor record of government share disposals due to the failure of selling Industrial Bank of Korea and Incheon International Airport
- (Inconsistent statistical treatment) need to include sales of securities acquired from tax payment in kind in tax revenue
Furthermore, the report suggests the need to improve the newly introduced accrual basis and double entry system so that it follows the accrual basis principle. Using this method will help us analyze the change in tax revenues and effectiveness of policies.

Revenue Estimation Division