South Korean 'AI Universal Dividend' Controversy Subsides, Samsung and SK Hynix Rebound Strongly Today

South Korean President Lee Jae-myung posted on May 13th, stating that his policy chief Kim Yong-bean's earlier remarks about "citizen dividends" were intended to explore the feasibility of distributing the country's excess tax revenue generated in the AI sector to the public, rather than implying the use of corporate profits to fund dividends.

The incident originated from a roughly 2500-word long post by Kim Yong-bean on Facebook on May 12th. The post discussed the profound impact of AI on the South Korean economy, corporate profits, and employment, and proposed that the government should plan in advance how to distribute the wealth brought by the AI boom. Kim Yong-bean believes that South Korea has a complete supply chain from memory chips, batteries to displays, and soaring profits of companies like Samsung and SK Hynix will bring the government billions of dollars in additional tax revenue.

Market concerns about a "windfall tax" quickly escalated, and the KOSPI index plummeted by 5.1% during trading on May 12th. Samsung Electronics closed down 2.3%, SK Hynix closed down 2.4%, and KOSPI ultimately closed down 2.3%.

The Office of the President of South Korea then stepped in to quell the fire. An official said to Bloomberg that Kim Yong-bean's remarks only represent his personal opinion and are not the subject of formal policy discussions. Kim Yong-bean himself also added clarification, saying that his idea was to use the "excess tax revenue" generated by the AI boom, not to impose new taxes on corporate profits.

Market sentiment quickly recovered after the clarification. On May 13th, Samsung Electronics opened at 190,900 won, jumping about 2.5% from the previous day's closing, and reaching a high of 194,600 won during the day; SK Hynix opened at 867,000 won, rising more than 4.5% from the previous day's closing, reaching a high of 886,000 won during the day. The KOSPI index closed at 3,846 points, basically stabilizing.

This turmoil reflects the political sensitivity of wealth distribution issues in the AI era. Samsung is expected to achieve an operating profit of 330 trillion won (about 220 billion US dollars) this year, potentially surpassing Apple and Google to become the second-most profitable company in the world, after Nvidia; SK Hynix's expected profit is also as high as 239 trillion won. Christy Tan, senior investment strategist at Franklin Templeton Institute, said to Bloomberg TV that Asian economies want to convey a signal to the public – "This concept is essentially to reallocate the benefits brought by AI progress to citizens."

At present, Kim Yong-bean's plan is still in a very preliminary stage and has not entered the formal policy process. However, against the backdrop of South Korean tech stocks' heavy reliance on foreign capital, any policy signals involving the distribution of corporate profits will have an immediate impact on market sentiment.