Hong Nam-ki: "Increase in Heavy Tax Rate on Comprehensive Real Estate Holding Tax for Multi-Homeowners... Reducing Burden on Actual Buyers" (Comprehensive)

Efforts to Expand Housing Supply for Actual Demand... Reform of the Rental Business Operator System

Hong Nam-ki, Deputy Prime Minister and Minister of Economy and Finance, is delivering opening remarks at the "10th Emergency Economic Central Countermeasures Headquarters Meeting" held at the Government Seoul Office in Jongno-gu, Seoul, on the 10th. Photo by Kang Jin-hyung aymsdream@

[Asia Economy Reporter Kwangho Lee] The government will raise the capital gains tax rates for multi-homeowners and short-term holders in regulated areas. However, it plans to protect low-income real demand buyers from adverse effects.

On the 10th, Hong Nam-ki, Deputy Prime Minister and Minister of Economy and Finance, stated at the 10th Emergency Economic Central Countermeasures Headquarters (Economic Central Headquarters) meeting held at the Government Seoul Office, "I apologize for the continued concerns about instability in the real estate market despite the recent announcement of the June 17 measures," adding, "Today, we will present and discuss the 'Supplementary Measures for Housing Market Stabilization' and announce it to the public immediately after the meeting through a joint briefing with related ministries."

First, the government will raise the comprehensive real estate holding tax (종부세) surcharge rates for multi-homeowners and increase capital gains tax surcharge rates for short-term holders and multi-homeowners in regulated areas while preparing exit measures. It will also push for reform of the registered rental apartment business system. Deputy Prime Minister Hong explained, "This includes fundamental reforms of the rental business system and strengthening the inspection of registered rental business operators' compliance."

Efforts to expand housing supply for real demand buyers will also be pursued simultaneously. Hong said, "In addition to the already announced housing supply plan for the metropolitan area, we will swiftly prepare fundamental measures to expand housing supply."

Measures to reduce the burden of home purchases for low-income and real demand buyers will also be prepared. Hong stated, "The measures will include strengthening support for first-time homebuyers, easing income requirements for low-income and real demand buyers, and enhancing rental loan support including for the youth."

At the Economic Central Headquarters meeting on the same day, in addition to the supplementary housing market stabilization measures, the 'Korean New Deal Comprehensive Plan' was discussed. Hong said, "The Korean New Deal Comprehensive Plan will be reported in detail at the national report meeting presided over by the President on the 13th."

Meanwhile, regarding the 'Korea Together Sale' ending on the 12th of this month, Hong expressed, "According to the mid-term review, there was a significant increase in non-face-to-face online shopping, traditional market sales, and Zero Pay payment amounts, showing considerable effects in stimulating consumption," and added, "I thank the public and all participants who willingly joined the consumption activation event to help small business owners and companies facing difficulties while strictly adhering to quarantine rules."

He continued, "While maintaining the premise that 'quarantine is economy,' we will continue the relay of domestic demand stimulation to keep the spark of consumption recovery alive," emphasizing, "If the emergency disaster relief fund was the first runner, the Korea Together Sale is the second runner."

He further stated, "The third runner in the relay is the consumption stimulation budget included in the 3rd supplementary budget recently approved by the National Assembly," forecasting, "The so-called eight major consumption coupons such as accommodation coupons (for 1 million people), dining coupons (for 3.3 million people), and tourism coupons (for 150,000 people) will lead about 1 trillion won worth of consumption stimulation."

Additionally, he said, "The supplementary budget also reflects the additional issuance of 4 trillion won in Onnuri gift certificates and local love gift certificates, which is expected to contribute to local consumption and regional economic revitalization," and added, "Given the current situation where export recovery is greatly constrained, the government will devote all efforts to revive domestic demand so that the economy recovers faster than any other country in the second half of the year."