[Reporter’s Notebook] Jongbu-se Amendment Delayed Again... National Assembly Out of Touch with Public Livelihood

The National Assembly building visible behind the Taegeukgi flag hoisted on the street in Yeouido-dong, Yeongdeungpo-gu, Seoul [Image source=Yonhap News]

The passage of the amendment containing this year's comprehensive real estate tax (종부세, Jongbu-se) reduction plan in the National Assembly is being delayed repeatedly. To smoothly apply the amendment's provisions, such as the Jongbu-se special cases and the special deduction for single-homeowners, the National Assembly must approve it by the 20th at the latest. However, the ruling and opposition parties are at odds over the chairmanship of the tax subcommittee, wasting time. The National Assembly, detached from the people's livelihood, is only increasing taxpayers' confusion and anxiety.

Earlier, the government announced it would push for Jongbu-se amendments to reduce the tax burden on homeowners, which had excessively increased under the previous administration. The amendment temporarily raises the Jongbu-se taxation threshold for single households from 1.1 billion KRW to 1.4 billion KRW and considers temporary two-homeowners, inherited homes, and low-priced local homes under 300 million KRW as single-homeowners to reduce their Jongbu-se burden. The market expects that such amendments will partially normalize the Jongbu-se system and reduce distortions in the real estate market.

However, the amendment is blocked in the National Assembly, and discussions have hardly progressed. The ruling and opposition parties have been unable to reach an agreement for a considerable time over the chairmanship of the tax subcommittee, the first gateway for discussing the Jongbu-se amendment.

Considering the schedule to submit the Jongbu-se special taxation report starting from the 16th of next month, the National Tax Service and the Ministry of Economy and Finance insist that the amendment must pass the National Assembly by the 20th at the latest. Even if this deadline is missed, taxpayers can still benefit through voluntary reporting during the declaration and payment period from December 1 to 15 after the issuance of tax bills. However, in this case, taxpayers must interpret the regulations themselves and calculate the amounts. Those unfamiliar with the complex tax laws or too busy with their livelihoods to file on time will inevitably suffer losses.

A Democratic Party official from the Planning and Finance Committee said, "Although the amendment should pass by the 20th, this is the government's position for administrative convenience," adding, "Nothing has been decided yet." Considering the remaining procedures such as the Planning and Finance Committee, the Legislation and Judiciary Committee, and the plenary session, the government and taxpayers are in urgent need, but the National Assembly seems to have plenty of time.

Among taxpayers who are trying to reduce taxes even by a single won through home purchases or sales, confusion over whether the amendment will pass is already intensifying. While the public's suffering grows due to soaring prices and interest rates day by day, the National Assembly is still engaged in turf battles and factional fights. It is hoped that both the ruling and opposition parties will start productive discussions on the amendment with the people's livelihood in mind, not vested interests.