Korean Alcohol Industry Faces 'Hangover' from Outdated Tax Rules
Creatrip Team
4 months ago
At the 17th Hong Kong International Wine & Spirits Fair, Hong Kong and Japan showcased how policy choices can boost beverage industries. Hong Kong abolished wine duties in 2008 and later cut spirit taxes, building logistics, storage, and re-export infrastructure to become an Asian trade hub. Japan actively subsidizes sake exporters and promotion, tripling sake exports over a decade. By contrast, Korea remains stuck with an ad valorem liquor tax (종가세) that taxes products by retail price; using better ingredients or longer aging raises taxes and discourages premium production. Calls to switch to a specific tax by alcohol content and volume (종량세) have repeatedly stalled for political reasons. Experts say reform is not just about lowering taxes but redesigning incentives to support small regional breweries, premium distillers, and exporters; without change, Korea’s beverage makers risk losing presence in global markets. (Hong Kong International Wine & Spirits Fair: major Asian trade show)
