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Korea’s ‘Citizen Dividend’ Proposal Rattles Markets

The president says reports miscast his aide’s personal call to share surplus AI tax revenue with the public.

Overview

  • Presidential policy chief Kim Yong-beom proposed on Tuesday a nationwide payout funded by AI-era gains, and the KOSPI swung down as much as 5.1% as Samsung and SK Hynix shares fell.
  • Kim later said he was referring to using excess tax revenue from the chip boom rather than a new windfall tax on company profits.
  • Cheong Wa Dae said the idea reflected Kim’s personal view and not an active government plan.
  • President Lee Jae Myung on Wednesday accused some media of distorting Kim’s remarks and said the point was to review distributing surplus tax receipts.
  • The debate comes as Samsung’s union demands bonuses worth 15% of operating profit and threatens an 18-day strike from May 21, and as economists and opposition figures warn that retroactive redistribution could chill investment in a market where chipmakers make up nearly half of the KOSPI.