South Korea’s finance minister spoke out against “corporate-bashing” by politicians who are calling for a tighter rein on conglomerates, as they try to woo voters ahead of elections.
“The recent wave of corporate-bashing by the ruling and opposition parties is feared to deepen a divide among citizens,” Bahk Jae-Wan told an economic meeting on Thursday.
“This phenomenon will do no good to our economy,” he said, reiterating his objection to an additional tax on the profits that conglomerates, known as chaebol, make on equity investments.
The chaebol powered South Korea’s post-war economic miracle and spearhead its booming export business, although they now employ less than 10 percent of the workforce.
But there is a widespread public perception that they have monopolised the benefits of economic growth. And politicians are calling for greater control over the top business groups ahead of parliamentary elections in April.
This week the main opposition Democratic United Party proposed a “chaebol tax” on investment profits and the revival of regulations aimed at keeping the conglomerates from expanding recklessly.
The conservative ruling Grand National Party also revised its platform to expand social welfare and promised to increase taxes on the rich.
Bahk urged big business groups to voluntarily share their wealth with society and work harder to narrow income imbalances.
President Lee Myung-Bak, himself a one-time chaebol executive, said Tuesday that pressuring conglomerates too hard could backfire.
“If businesses are pressured too much, it could lead them to reduce investment and hiring. This is not helpful,” he said.