The Role of NABO in Tax System Analysis & Revenue Estimation

Introducing NABO The Role of NABO in Revenue Analysis NABO’s ongoing Efforts

Introducing NABO

National Assembly Budget Office (NABO) ・중소기업 ・ 에너지 분야와 사회복지에 집중 Established in 2003 as a fiscal institution within the National Assembly Established in 2003 as a fiscal institution within the National Assembly to ensure efficiency in the Legislature’s check on and oversight of Executive management of state finance.

National Assembly Budget Office (NABO) Key Objectives ・중소기업 ・ 에너지 분야와 사회복지에 집중 Established in 2003 as a fiscal institution within the National Assembly to ensure efficiency in the Legislature’s check on and oversight of Executive management of state finance.

National Assembly Budget Office (NABO) Organization ・중소기업 ・ 에너지 분야와 사회복지에 집중 NABO is consisted of 3 offices and 1 bureau(19 divisions). Budget analysis office research on budget bills, fund operation plans and estimate bill costs. Economic analysis office research on economic policies including tax policies, forecast macroeconomic variables, analysis fiscal management plan, and estimate tax revenues. Program evaluation bureau evaluates major national programs and government performance management. As we presented on NABO’s role on Expenditure estimating last year, today we will focus on NABO’s role on Tax system analysis and revenue estimating.

The Budget Analysis Office within NABO Roles and Responsibilities ► Budget Analysis: Analyzes government’s budget proposal ► Bill Cost Estimation: Estimates annual costs 5 years from the year of enactment

The Economic Analysis Office within NABO Roles and Responsibilities ► Analysis and Forecasts on Macro-economic Trends and Economic Policies ► Analysis and Research on Fiscal Policies, Consolidated Fiscal Balance, National Debts, and the Fiscal Systems ► Estimation and Analysis on Tax and Non-tax Revenues

2. The Role of NABO in Revenue Analysis

Roles of NABO in Revenue Analysis Analyzes on… ► Analysis of Tax Revision ► Revenue Estimation ► Evaluation of Tax Expenditure Publishes / Provides ► Regular Reports ► Customized Services

Divisions in Charging of Revenues Economic Analysis Office Tax Analysis Division Revenue Estimates Division Ⅰ Revenue Estimates Division Ⅱ

Revenue Analysis Tax Analysis Division • Analysis of the Korean tax system • Policy studies on the economic effects from the changes in tax law and the behavior of taxpayers • Research on the medium- and long-term effects of tax reform

Revenue Analysis Revenue Estimates Division Ⅰ: Tax revenue • Projection of medium- and long-term tax revenues • Development of econometric models for tax revenue projection • Estimation of the revenue changes from proposed of tax law

Revenue Analysis Revenue Estimates Division Ⅱ : Special Taxation, Non-Tax Revenue • Projection of medium- and long-term non-tax revenues • Estimation of the revenue changes from proposed of non-tax law • Estimation of the revenue changes from proposed of special taxation law • Analysis of the tax expenditures bills

Reports and Services Regular Reports ► Tax Revenue Outlook ・중소기업 ・ 에너지 분야와 사회복지에 집중 Regular Reports ► Tax Revenue Outlook ► Analysis of Tax Revision ► Analysis of Tax Expenditure Proposal

Reports and Services “Tax Revenue Outlook” 복지에 집중 ► Projection of medium- and long-term revenues ⇢ project of the tax revenue changes over 5-year periods based on the economic growth forecasts and the lately tax reform ► Analysis on the major factors leading the anticipated changes of tax revenue

Reports and Services “Analysis of Tax Revision Proposal” ・중소기업 ・ 에너지 분야와 사회복지에 집중 “Analysis of Tax Revision Proposal” ► Analysis on the Government’s Tax Revision Bill ⇢ analyze the key issues of tax policy and the revenue effect of the proposal ► Research and analysis on major issues in the field of taxation ⇢ suggest appropriate direction of tax revision including medium or long-term tax system developments

Reports and Services “Analysis of Tax Expenditure Proposal” ・중소기업 ・ 에너지 분야와 사회복지에 집중 “Analysis of Tax Expenditure Proposal” ► Analysis on the Administration’s Tax Expenditure Proposal ⇢ analyze the scale of national tax expenditures and the implementation of the tax expenditure management ► Meta Evaluation on the Administration’s Special Tax Assessment ⇢ evaluate the results of the administration’s assessment on KRW 30 billion or more in tax exemptions each year and proposed new special tax items from a budget perspective

Reports and Services Customized Services ・중소기업 ・ 에너지 분야와 사회복지에 집중 Customized Services ► Tax and Non-tax revenue estimates ► On-Demand reports NABO also provides services to members of congress directly. NABO estimates change in tax revenue caused by a tax revision. On-demand reports on fiscal issues are also available.

Achievements Credible Forecast On-time Service

3. NABO’s ongoing Efforts

NABO’s ongoing Efforts As a independent fiscal institution within the legislature, NABO strives to enhance the credibility and accuracy of its analysis through a strict internal review mechanism ► Review at office level that takes into consideration external expertise and executive’s opinions ► Deliberation by the Publication Review Committee before publication of report To increase the adoption rate of its analysis reports, NABO regularly holds briefing sessions for ► Members of the Special Committee on Budget and Accounts twice annually ► Aides to assembly members if necessary

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