초록 열기/닫기 버튼
As the Korea-GCC FTA is expected to be signed in the near future, the Koreangovernment has begun to be concerned about revenue losses following tariff cuts on importedcrude oil. This study extends Shim and Jung (2012) taking Korean oil firms' exportingactivities into account, and examines the effects of tariff cuts and consumption tax reform onthe oil firms' profits and government revenue. When Korean government implements theplausible tariff-tax reform strategy, which is to increase consumption taxes at a scale of lessthan the tariff cuts times the pre-tax reform crude oil price. it turns out to increase oil firms'profits in domestic supply of petroleum products, but decrease their profits in exports ofpetroleum products. Therefore, when this strategy is implemented, Korean oil firms increasedomestic supply and reduce exports of petroleum products. Regarding the governmentrevenue, this strategy causes revenue loss, which is the similar results of Shim andJung(2012). However, the negative effect of the strategy on government revenue in this studyturns out to be not as big as Shim and Jung(2012)'s result. This indicates that the revenueeffect of the same strategy suggested by Shim and Jung(2012) is exaggerated.
