Expected to Be Included in the Tax Reform in the Second Half of the Year
The Presidential Office announced on the 31st that "the comprehensive real estate holding tax (종합부동산세, 종부세) will be thoroughly reviewed and the system will be reformed to contribute to tax fairness and market stability."
A senior official from the Presidential Office stated, "Since excessive taxation on real estate holdings is inappropriate, it is desirable to completely abolish the 종부세." The 종부세 is a tax imposed on those who own real estate valued at 900 million KRW (1.2 billion KRW for single homeowners) or more.
The official explained, "Abolishing the 종부세 for owner-occupied single homeowners only addresses one part of the various distortions caused by the 종부세 and is fundamentally limited," adding, "We plan to reform the system to ensure tax fairness."
In the political sphere, various tax reform measures, including the abolition or easing of the 종부세, are being positively considered. Park Chan-dae, floor leader of the Democratic Party of Korea, recently hinted at abolishing the 종부세 for single homeowners in a media interview.
Choo Kyung-ho, floor leader of the People Power Party, also told reporters at a lawmakers' workshop the day before, "We actively welcome discussions on the abolition, reform, and easing of the 종부세 raised by some members of the Democratic Party." Since abolishing the 종부세 was also a campaign pledge of President Yoon Suk-yeol during the presidential election, the government is expected to propose an amendment to the 종부세 law in this year's tax reform plan that can significantly further reduce the 종부세 burden.
Additionally, inheritance tax relief will be pursued. As revealed by Deputy Prime Minister and Minister of Economy and Finance Choi Sang-mok at a press briefing on the 27th, the inheritance tax reform plan will be prepared through public hearings and other processes, addressing market demands such as improving the premium valuation for major shareholders, easing the burden on excellent value-up companies for business succession, and expanding business inheritance deductions.
A Presidential Office official said, "The relevant content will be included in this year's tax reform plan," adding, "No specific decision has been made yet regarding the introduction of an inheritance acquisition tax."
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