This study aims to foster informed public discourse on inevitable tax increases in response to the substantial fiscal pressures of population aging. Chapter 2 examines how major advanced economies that experienced population aging earlier than South Korea mobilized financial resources during this demographic shift. Chapter 3 empirically analyzes tax reform strategies that reduce revenue volatility, support economic growth, and promote equitable taxation. The findings support strengthening value-added tax (VAT) and personal income tax―a widely endorsed approach mong tax experts and implemented in major advanced economies. However, Korea has limited experience with universal tax increases and faces considerable public resistance to such measures. To assess whether these concerns are based on empirical evidence, Chapter 4 examines 150 cases of VAT or personal income tax increases implemented in major advanced economies. The findings reveal that only 20% of these tax increase cases resulted in a change in government. Finally, Chapter 5 argues that concerns over political repercussions should not preclude universal tax increases as a key policy option for enhancing the sustainability of public services. The study also emphasizes two prerequisites for the government to address before initiating public discourse on tax increases: earning public trust in the efficiency and effectiveness of fiscal expenditures through structural reforms and improving the general public’s fiscal literacy.

Abstract (ENG)
Preface
Summary (KOR)

Chapter 1Introduction

Chapter 2International Comparison of Financing Methods in an Aging Population Era
Section 1Comparison of Total Fiscal Size
Section 2Comparison by Major Revenue Items

Chapter 3Empirical Analysis of Tax Structure Considering Population Aging
Section 1Trends in Tax Revenue Volatility, Economic Growth, and Equity
Section 2Results of Empirical Analysis of Tax Structure Considering Population Aging
Section 3Implications

Chapter 4Cases of Strengthening the Three Major Core Taxes by Type
Section 1Overview of Tax Rate Changes in the Three Major Core Taxes in Major Advanced Countries
Section 2Cases of Strengthening Income Tax and Value-Added Tax in Major Advanced Countries
Section 3Summary

Chapter 5Future Directions for Tax Policy

References
Appendix