Korea’s high inheritance tax rate is apparently prompting more wealthy Koreans to move to foreign countries that have more lenient regulations.
Asia’s fourth-largest economy is ranked second in the OECD only after Japan regarding inheritance tax rates. The maximum inheritance tax rate in Korea is 50 percent, compared to Japan’s 55 percent and the OECD average of 25 percent.
In a taxation environment such as this, a survey recently released by Henley & Partners, a London-headquartered investment migration consulting firm, estimated that Korea has lost the world’s seventh-highest number of rich people to emigration this year.
The estimation is based on tra
cking the movements of over 150,000 high-net-worth individuals worldwide in the database, which is focused on individuals from high-value companies who have one of the following job titles: founder, chairperson, CEO, CIO, president, director or managing partner.
It estimated that Korea had a net outflow of around 800 high-net-worth individuals, or those whose net assets are valued at $1 million or higher, who have left Korea to relocate to another territory during the year — as of June.
The figure was an increase from the net outflow of 400 wealthy Koreans the previous year.
China topped the net outflow chart with 13,500, followed by India with 6,500, the United Kingdom with 3,200, Russia with 3,000, Brazil with 1,200 and Hong Kong with 1,000.
Of the seven, Korea along with the U.K. were the only countries where the estimated number of wealthy emigrants doubled in the 2022-23 period.
China marked an increase from 10,800 during the cited period, while the remaining five saw declining emigration.
Citing Henley & Partners’ survey and the 2022 U.N. Population Fund data, industry sources said Korea would be ranked No. 1 if the survey focused on the ratio of rich emigrants out of the total population in their respective countries. Source: Korea Times
