논문

This paper aims to suggest the idea of national and local tax reform especially emphasizing the view- point of harmony between central and local government.
The approach in this study is heavily relied on the constitutional political economy proposed by James M. Buchanan, the Nobel Laureate in 1986. In this paper, particularly those theoretical aspects, such as the Wicksellian majoritarian social consensus likely to result in Pareto efficiency as well as social justice, the legal allowance of power to tax to local autonomies, are applied to resolve problems of local finance in Korea.
It follows then in this paper, on the basis cf economic philosophy in constitutional political economy, the tax design for central as well as local government in Korea is proposed, thereafter, the tax reform in detail is suggested. For the tax design, the allowance by central government to render the independent power to tax to local entities the harmonization of tax revenue system between central government and local autonomies, and the unified tax rate system between central and local government are mentioned to he considered when central government under- takes national and local tax reform policy.
As to the tax reform, the increase in residence tax imposed by local autonomies at present should be introduced for implementation not only personal level but also legal body level. Secondly, it is proposed that local autonomies should create their own new tax revenue scarce by imposing those economic activities connected to increasing income level of residents, such as bath in warm water source, extravagant sightseeing, issue of commodity ticket and advertisement by business firms, etc. Thirdly central] government should render a part of tax source in VAT to local autonomies, if harmonization of national and local tax system is to be realized.
Those parts of VAT which are imposed or regional economic activities, like retail, automobile use, oil and energy use, etc. would be given in its taking power to local governments so as to share total tax revenue by central and local entity at the same time, thereby, the idea of harmony between two governments level could be in a efficient as well as just way secured.