Seoul, Jul 21 (IANS): South Korea's finance ministry said on Thursday that it will cut corporate and income taxes next year in a bid to boost corporate investment and lower tax burden on ordinary people troubled by high inflation.

The maximum corporate tax rate, levied on the tax base of over 300 billion won (228.8 million US dollars), will be lowered to 22 per cent from the current 25 per cent, according to the Ministry of Economy and Finance.

The previous government raised the maximum rate by 3 percentage points to 25 per cent in 2017, marking the first hike in 28 years, Xinhua news agency reported.

The tax base for the 10-percent minimum tax rate among small firms will be lifted to 500 million won (381,390 dollars) from the current 200 million won (152,560 dollars) to decrease the tax burden on small companies.

Income taxes for those with an annual income of less than 50 million won (38,140 dollars) will be lowered for the first time in 15 years to support the middle- and low-income families suffering from surging inflation.

Comprehensive real estate holding taxes will be cut by lowering the tax rate and raising the tax base as home prices surged in recent years amid the record-low borrowing costs.

The ministry planned to submit the tax reform bill to the parliament before September 2 for approval.