Ruling Party and Government to Announce Real Estate Measures as Early as the 10th

[Image source=Yonhap News]

[Sejong=Asia Economy Reporter Kim Hyunjung] The government and the ruling party are expected to announce a real estate tax reform plan that expands the tax burden on multi-homeowners in terms of holding and transaction taxes as early as the 10th. According to the Democratic Party and the government on the 9th, the party and government are coordinating a tax law amendment bill focusing on adjusting the brackets and rates for comprehensive real estate tax, capital gains tax, acquisition tax, and others. Once the agreement is reached, it is likely to be submitted to the National Assembly in the form of a bill sponsored by Representative Ko Yong-jin, the ruling party's floor leader on the National Assembly's Planning and Finance Committee.

First, the party and government have agreed to significantly strengthen the tax burden on multi-homeowners. However, it is known that further discussions are needed on whether to expand the taxable base by revising the tax base threshold, raise the tax rates, or adjust both. In addition, measures to protect actual demanders will be prepared, such as acquisition tax reductions for low-priced houses or lowering capital gains tax burdens for first-time homebuyers. Regarding the controversial bill proposed by Democratic Party lawmaker Kang Byung-won, which includes retroactive abolition of tax benefits for rental business owners and raising capital gains tax rates up to 80% for short-term homeowners, it is reported that the prevailing opinion within the party is not to include it in the main bill.

Furthermore, the party and government plan to prepare supplementary measures in the form of exceptions to address cases where it has become difficult to obtain balance loans due to the application of loan-to-value (LTV) regulations when winning a housing subscription in newly designated regulated areas announced in the June 17 measures. Following the tax reform, the government will announce housing supply plans as early as next week. A Ministry of Land, Infrastructure and Transport official said, "We will discuss reforms to the subscription system and plans to expand supply and announce them in about one to two weeks."