Foreign companies in Korea account for just 1% of corporate tax payments, except Baedal Minjok at 5%

Corporate tax payments by foreign companies operating in Korea have dropped by more than 30% over the past two years, while Woowa Brothers, operator of Baedal Minjok, recorded the highest corporate tax-to-revenue ratio at 5%. In comparison, large foreign companies with annual sales exceeding 3 trillion won paid an average of just 0.4% of their revenue in corporate tax.
On the 11th, corporate research institute CEO Score analyzed corporate tax expenses and donations at 1,583 foreign companies in Korea that submitted both business reports and audit reports for three consecutive years, out of a total of 1,872 such firms. The study found that their combined corporate tax payments fell from 7.2365 trillion won in 2022 to 4.8226 trillion won in 2024, a decrease of 33.4% (2.4139 trillion won) in two years. For this survey, foreign companies were defined as firms where the largest shareholder, headquartered overseas, exercises management control by holding more than 50% of voting rights, or effectively controls management through a dominant stake in the governance structure even if its equity share is 50% or less. Over the past three years, these foreign companies paid corporate tax equivalent to only 1.1% of their average revenue, and the larger their sales, the lower their tax burden as a share of revenue.
Companies with less than 1 trillion won in annual sales paid corporate tax equal to 1.8% of revenue, while those with sales between 1 trillion and 3 trillion won recorded a ratio of 1.5%. In stark contrast, large foreign companies with more than 3 trillion won in revenue paid an average of only 0.4% of their revenue in corporate tax.
On the other hand, Woowa Brothers, which operates Baedal Minjok, had the highest corporate tax-to-revenue ratio among the companies surveyed. Its average ratio over the past three years was 5.0%, far above the industry average. The company’s revenue rose 46.7%, from 2.9471 trillion won in 2022 to 4.3226 trillion won in 2024, while its corporate tax payments increased 43.7%, from 127.6 billion won to 183.4 billion won over the same period.
The next-highest corporate tax ratios were recorded by LINA Life Insurance Company (3.6%), MetLife Insurance Company of Korea (1.9%), Apple Korea (1.5%), Novelis Korea (1.4%), Kumho Tire (1.1%), Singwei Korea (1.1%), Renault Korea (0.9%), BMW Korea (0.9%), and Costco Wholesale Korea (0.8%). Meanwhile, the total amount of donations, which reflects foreign companies’ social contribution activities, has increased. Donations rose from 102 billion won in 2022 to 175.5 billion won in 2024, an increase of 72.1% (73.5 billion won). Among foreign companies with more than 3 trillion won in revenue, those with the highest donation-to-revenue ratios were SERVEONE (0.359%), LINA Life Insurance Company (0.226%), EUKOR Car Carriers (0.218%), Woowa Brothers (0.094%), and Mercedes-Benz Korea (0.061%).

wongood@fnnews.com Joo Won-gyu Reporter