, the banks and corporations involved would have had to declare bankruptcy, which according to the Korean government would have led to the collapse of the Korean economy. The Korean government, thus, absorbed this debt through the use of public funds by issuing bonds.
The bond debt will be repaid over time through the collection of indirect taxes. This policy means that the costs of restructuring will be paid for by the individual taxpayers, rather than by either the corporations that cause the currency crisis or other corporations. Simultaneously, the Korean government provided no assistance for workers who lost jobs during the currency crisis.
Taxes are imposed on individuals in both South Korea and the USA. Employment income, commissions, interest, dividends, rental income, and self-employment income account for most of the taxable income for individuals in both countries.
Individual income tax rates in the USA vary in relation to both marital and filing status. Married couples filing joint returns are taxed at the rate of 15 percent on taxable income not exceeding US$32,450. The rate increases to 28 percent for taxable income in excess of US$32,450 but not exceeding US$78,400, and to 31 percent for taxable income exceeding US$78,400 (Ernst & Young, 2002b).
In contrast, married couples filing separate returns are taxed at the rate of 15 percent on taxable income not exceeding US$16,225. The rate increases to 28 percent for taxable income in excess of US$16,225 but not exceeding US$39,200, and to 31 percent for taxable income exceeding US$39,200 (Ernst & Young, 2002b).
Unmarried heads of household are taxed at the rate of 15 percent on taxable income not exceeding US$26,050. The rate increases to 28 percent for taxable income in excess of US$26,050 but not exceeding US$67,200, and to 31 percent for taxable income exceeding US$67,200. Unmarried individuals other than heads of household are taxed at the rate...