South Korea's income redistribution effect through taxes and welfare ranks among the lowest in the OECD

It was found that the effect of income redistribution through Korea’s tax and welfare system remains at a low level among OECD member countries. As of 2023, the improvement rate in the pretax and posttax Gini coefficient was 17.6%, ranking 28th out of 29 countries for which statistics were available. The OECD average was 34.4%. The Gini coefficient is an indicator that shows income inequality, and it calculates the redistribution effect by comparing market income before taxes and transfer income with disposable income after they are reflected. In Korea, inequality was relatively low based on market income, but after taxes and welfare were taken into account, the ranking dropped significantly, suggesting that the redistribution function was not working sufficiently. By age group, both those aged 18–65 and those aged 66 and older had lower improvement rates than the OECD average, and the gap was especially wider among older adults. According to the article, the decline in ranking from pretax to posttax for the 66andolder age group was the largest among the 29 countries surveyed.