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reinstate "domestic" - cite [2] clearly states an enterprise VAT like tax goes back to the 1970s |
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{{Taxation}}
Officially, [[North Korea]] does not have domestic [[taxes]] and claims to be the world's only tax-free country.<ref name="dailynk">{{cite web|url=https://www.dailynk.com/english/read.php?cataId=nk02900&num=6203|author=Yoo Gwan Hee|date=2008|title=Tax? What Tax? The North Korean Taxation Farce|publisher=DailyNK}}</ref><ref name="HaggardNoland2011">{{cite book|author1=Stephan Haggard|author2=Marcus Noland|title=Witness to Transformation: Refugee Insights Into North Korea|url=https://books.google.com/books?id=DLq0E-4dtbIC&pg=PA64|year=2011|publisher=Peterson Institute|isbn=978-0-88132-515-7|page=64}}</ref> However, the North Korean government still collects revenue from its citizens in the form of [[hidden taxation]] through various [[sales tax]]es.<ref name="Lee2001"/> In particular, the [[turnover tax]] from consumption provides for the majority of the state revenue in North Korea.<ref name="Lee2001-71">{{harvtxt|Lee|2001|page=71}}.</ref> The North Korean government, therefore, does collect revenue, in a manner which has been compared to a taxation system by international observers. However, inside North Korea the word "tax" is not used, and the term for state revenue has been variously translated as "socialist income accounting", "socialist economic management income", and in similar fashion.<ref name="Lee2001-71"/><ref>{{Cite book|url=https://books.google.com/books?id=JIlh9nNeadMC|title=North Korea Handbook|last=Seoul|first=Yonhap News Agency|date=27 December 2002|publisher=M.E. Sharpe|isbn=9780765635235|pages=229–230|language=en}}</ref> "Tax Abolition Day" is observed annually on 1 April in North Korea.<ref name="dailynk"/>
Agricultural [[tax-in-kind]] introduced in 1947 was abolished in North Korea in 1966, as the process of [[Agriculture in North Korea|collectivization of North Korean agriculture]] ended.<ref name="Lee2001">{{cite book|first=Hy-Sang|last=Lee|title=North Korea: A Strange Socialist Fortress|url=https://books.google.com/books?id=6Rx8Q_cxqvkC&pg=PA70|year=2001|publisher=Greenwood Publishing Group|isbn=978-0-275-96917-2|page=70}}</ref> [[Direct taxes]], such as [[income tax]], were officially eliminated in 1974 as "remnants of an antiquated society".<ref name="Lee2001"/><ref name="loc">{{cite web|url=https://www.loc.gov/item/2008028547/|title=North Korea : a country study |work=The Library of Congress|pages=152, 164–165}}</ref> This action, however, did not have any significant effect on state revenue because the overwhelming proportion of government funds—an average of 98.1 percent during 1961–1970—was from [[sales tax]]es such as [[turnover tax]]es, deductions from profits paid by state enterprises, and various user fees on machinery and equipment, irrigation facilities, television sets, water, and so on.<ref name="loc"/> This is in line with similar practices in other [[Socialism|socialist]] countries.<ref name="Lee2001"/><ref name="Lee2001-71"/>
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