Over 470,000 S. Korean firms fail to report net profit in 2024

Seoul, Oct 10 (IANS) More than 470,000 South Korean companies that paid corporate taxes in 2024 failed to post a net profit amid an economic slowdown, government data has showed.

The number of companies that reported no net income reached 471,163 last year, up 45,933, or 10.8 per cent, from 425,230 a year earlier, according to the National Tax Service (NTS), reports Yonhap news agency.

It marked the largest annual increase since the agency began compiling related data in 2012.

Companies that made no profit accounted for an all-time high of 44.5 per cent of the 1,058,498 firms that paid corporate taxes last year.

The share of such companies had remained below 40 per cent until 2019 before surpassing the 40 per cent mark for the first time in 2020 and further climbing to 41.3 per cent in 2023.

Meanwhile, the number of companies posting a net profit of over 10 billion won ($7.03 million) fell by 296, or 7.3 per cent, to 3,776 from 4,072 during the same period.

It was the first time that firms earning more than 10 billion won in net profit recorded an on-year decline.

Last year, South Korea logged a tax revenue shortfall of 30.8 trillion won, marking the second consecutive year of a large deficit following a 56.4 trillion-won shortfall in 2023.

This year's national tax revenue is expected to fall 12.5 trillion won short of its target due to sluggish domestic demand. The government projects total tax revenue of 369.9 trillion won for 2025, up 33.4 trillion won from the previous year.

Meanwhile earlier data by the Financial Supervisory Service showed that British investors were the most active traders of South Korean stocks this year.

The foreigners traded 1,247.7 trillion won ($889.01 billion) worth of South Korean stocks between January and August, as per the same data.

By nationality, trading volume was the heaviest among investors from Britain, at 557.4 trillion won, accounting for 44.7 per cent of the total.