[Asia Economy Reporter Hwang Sumi] As the announcement of this year's official prices for apartment complexes approaches, interest is growing regarding the impact on real estate holding taxes.
According to the Ministry of Land, Infrastructure and Transport on the 20th, the government plans to announce the official prices for apartment complexes for 2022 on the 23rd. Industry insiders expect this year's official prices for apartment complexes to rise by about 20% compared to last year. This estimate is based on this year's realization rate of 71.5% for apartment complexes and considering last year's increase in housing prices.
Last year, the official prices for apartment complexes nationwide rose by 19.05%. In particular, Busan saw a 19.67% increase, a sharp rise compared to 2020 (0.02%).
If the official prices, which serve as the basis for calculating various taxes, increase, the tax burden may also rise. Accordingly, the government plans to present measures to alleviate the burden of holding taxes such as property tax and comprehensive real estate tax, as well as related systems like health insurance premiums.
Earlier, at the end of last year, the Ministry of Land announced the official prices for standard land and standard houses, suggesting examples such as using the 2021 official prices for property tax or deferring payment of the comprehensive real estate tax for elderly taxpayers.
Additionally, in line with President-elect Yoon Seok-yeol's pledge, measures are being considered to further ease the holding tax burden by imposing property taxes based on 2020 levels rather than last year. Discussions are also underway to freeze the comprehensive real estate tax at last year's level.
Currently, flexible application of the fair market value ratio to reduce tax burdens is being actively discussed. The fair market value ratio is the rate multiplied by the official price to determine the tax base, which is the standard for taxation. The higher this ratio, the greater the tax burden. For this year, the fair market value ratio is 60% for property tax and 100% for comprehensive real estate tax.
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