Refiners, chemical companies to pay record taxes on stellar performance
SEOUL, Feb. 22 (Yonhap) — South Korea’s oil refiners and chemical companies are expected to pay a record amount in corporate taxes for their 2016 business performance, as their bottom lines improved sharply, industry sources said Wednesday.
Last year, SK Innovation Co. and the country’s three other oil refiners racked up a combined operating income of 8.03 trillion won (US$7.01 billion) on the back of improved cracking margins and inventory gains, an all-time high figure.
Also, four major chemicals firms, including LG Chem Ltd. and Lotte Chemicals Co., are forecast to have posted a combined 6.5 trillion won in operating income, also a record high.
In 2014, major South Korean oil refiners and chemical entities posted their worst performances ever as a free fall in oil prices hurt the value of their crude inventories amid tight cracking margins.
Their combined operating income roughly stood at 1.2 trillion won in that year, and their corporate tax payment was roughly 500 billion won.
But in 2016, the local refiners and chemical companies are forecast to pay a combined 3.6 trillion won in taxes.
For one, SK Innovation, the top refiner in the country, is expected to pay some 1 trillion won in corporate taxes as it racked up its best earnings in its history last year, the sources said.
sam@yna.co.kr