"Two-Homeowners Tied Up by Lease Renewal Exempt from Capital Gains Tax"… Bae Hyun-jin Proposes Bill

[Image source=Yonhap News]

[Asia Economy Reporter Kim Hyemin] On the 20th, a bill was proposed to grant capital gains tax exemption benefits to two-homeowners who are stuck in housing sales due to tenants exercising their right to request contract renewal, amid the upcoming increase in the capital gains tax surcharge rate in June.

On the same day, Bae Hyunjin, a member of the People Power Party, announced the proposal of an 'Income Tax Act Amendment' that grants capital gains tax exemption benefits for the period during which tenants request lease contract renewal.

Under current law, if a single household owning one home temporarily becomes a two-homeowner by acquiring another home before transferring the first home, capital gains tax is exempted if the existing home is sold within three years from the date of acquiring the new home.

However, with the amendment to the Housing Lease Protection Act, if the existing tenant exercises the right to request contract renewal, it becomes difficult to transfer the property during that period. Bae pointed out that a tax bomb for such temporary two-homeowners is inevitable in June.

Baek Hyun-jin, a member of the People Power Party, is attending and questioning at the National Assembly's Culture, Sports and Tourism Committee's audit of the Korea Sports Council held on the 15th. Photo by Yoon Dong-joo doso7@

Regarding the amendment, Bae said, "This aims to enhance tax fairness by exempting capital gains tax for the period during which tenants request contract renewal for unavoidable temporary two-homeowners," adding, "It will alleviate unreasonable tax burdens, complement the blind spots of the hastily passed three lease laws by the government and ruling party, and also greatly help secure insufficient jeonse (long-term deposit lease) housing supply."