MW The hottest stock market in the world finally met its match: taxes
By Steve Goldstein
A currency dealer walks past a screen showing South Korea's benchmark stock index (KOSPI) in a foreign exchange dealing room at the Hana Bank headquarters in Seoul on May 6, 2026. South Korean stocks fell on Tuesday after a big move higher.
The idea that citizens should get a cut of the booming profits of tech companies derailed one of the hottest stock markets in the world on Tuesday.
South Korea's Kospi KR:180721 fell as much as 5.1% and closed 2.3% lower after a Facebook post from a presidential policy aide that citizens should enjoy a dividend from taxes on AI profits.
"The fruits of the AI infrastructure era are not the results generated by certain companies alone ... they were produced on a foundation that all the people have built together over half a century," the presidential policy chief wrote, according to the news agency Yonhap.
"Part of these fruits should be structurally returned to the people," he said.
The aide, Kim Yong-beom, subsequently clarified he wanted to tap the growing tax revenue and not impose a higher tax rate.
Memory-chip makers Samsung Electronics (KR:005930) and SK Hynix (KR:000660) have driven the meteoric gains in the South Korean index, that's still up 81% on the year.
Their ability to pass on rising prices to customers ranging from data-center providers to smartphone makers has resulted in the country's stock-market boom, that this year has been entirely driven by earnings.
-Steve Goldstein
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(END) Dow Jones Newswires
May 12, 2026 05:20 ET (09:20 GMT)
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