Bloomberg News

South Korea Sees $210 Million From Foreign-Currency Debt Levy

March 03, 2012

South Korea estimates $210 million in yearly receipts from a tax on holdings of foreign-currency debt introduced by the government to restrain short-term external borrowing.

Australia & New Zealand Banking Group Ltd. (ANZ) paid $760,000, the first fee under the so-called “macro-prudential stability levy,” to the central bank on Feb. 28, the Bank of Korea and finance ministry said in a joint e-mailed statement today.

South Korea adopted the tax last August on non-deposit foreign-currency liabilities held by both domestic and foreign banks, and will use the funds to help ease liquidity crunch at financial companies in a crisis. Debt of less than one year is subject to a levy of 0.2 percent and those with longer maturities subject to lower rates.

To contact the reporter on this story: Eunkyung Seo in Seoul at eseo3@bloomberg.net

To contact the editor responsible for this story: Paul Panckhurst at ppanckhurst@bloomberg.net


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