Kim Byungki of Democratic Party Signals Review of Raising 1 Billion Won Major Shareholder Threshold

KOSPI 5000 Special Committee Members
Suggest Reconsideration of Stricter Major Shareholder Criteria

Kim Byunggi, Acting Party Leader and Floor Leader of the Democratic Party of Korea, is speaking at the Supreme Council meeting held at the National Assembly on the 1st. Photo by Kim Hyunmin

Kim Byungki, acting leader and floor leader of the Democratic Party of Korea, has suggested the possibility of reconsidering the tax reform plan that would tighten the definition of a 'major shareholder' subject to capital gains tax on stock transfers from 5 billion won to 1 billion won.

On August 1, Kim wrote on Facebook, "We will review the possibility of raising the 1 billion won major shareholder threshold, focusing on the KOSPI 5000 special committee and the tax normalization special committee within the party," and added, "We will focus on restoring investor trust through close consultations between the party and the government."

The government, through the '2025 Tax Reform Plan,' decided to strengthen the standard for major shareholders subject to capital gains tax on listed stocks from 'holding 5 billion won or more per stock' to 'holding 1 billion won or more per stock.' As a result, there have been ongoing criticisms about whether it is appropriate to define those holding 1 billion won in stocks as major shareholders and to tax them accordingly. There have also been criticisms that this move runs counter to the KOSPI 5000 era, which is a key policy direction of the Lee Jaemyung administration.

Lee Soyoung, a member of the KOSPI 5000 special committee, stated on Facebook, "It has been pointed out that the major shareholder capital gains tax causes unnecessary market distortions at the end of the year, and it is questionable whether someone holding 1 billion won in stocks can be considered a major shareholder," adding, "This does not fit with the government's policy of redirecting capital from real estate to stocks."

Park Hongbae, another member of the special committee, also wrote on Facebook, "I agree with Representative Lee's concerns," and added, "This issue should be decided through public discussion within the party."