Oh Sehoon: "Raising Holding Taxes Could Increase Housing Prices... We Must Be Cautious" [2025 National Audit]

"If holding taxes are raised, other side effects may occur"
Deputy Prime Minister Koo Yoon-cheol: "Low holding taxes discourage property sales"

Seoul Mayor Oh Sehoon is responding to questions from committee members during the National Assembly Land, Infrastructure and Transport Committee's audit on Seoul City held at Seoul City Hall on the 20th. Photo by Yonhap News

Seoul Mayor Oh Sehoon has expressed a cautious stance regarding the revision of real estate taxation, emphasizing the need for prudence in strengthening property holding taxes.

During the National Assembly Land, Infrastructure and Transport Committee's audit on Seoul City held at Seoul City Hall on the 20th, Assemblyman Um Taeyoung from the People Power Party raised related questions. Mayor Oh responded, "I have seen discussions about raising property holding taxes while lowering transaction taxes, but increasing the holding tax could lead to other side effects."

He further stressed, "There is a possibility that housing prices could actually rise due to higher holding taxes," adding, "I believe we should be cautious about strengthening property holding taxes."

Previously, on the 16th (local time), Deputy Prime Minister and Minister of Economy and Finance Koo Yooncheol suggested the possibility of a comprehensive tax system overhaul, including holding and capital gains taxes, if the upward trend in housing prices in the Seoul metropolitan area does not subside. Deputy Prime Minister Koo pointed out, "Currently, Korea's real estate tax system imposes a low burden at the holding stage and a high burden at the transaction stage," adding, "This has intensified the 'lock-in effect,' preventing properties from being released onto the market."

He continued, "It is advantageous to hold onto a house, while the tax burden increases only when selling, which blocks market liquidity," and stated, "Ultimately, this makes it difficult for the real estate market to circulate smoothly."

Deputy Prime Minister Koo also explained, "It's not an issue that can be decided easily, but we are preparing to formulate policies after listening to expert opinions and considering the appropriate timing," adding, "We will determine the policy direction through research and discussion at a level that the public can accept."

Meanwhile, regarding the need for close coordination between the Ministry of Land, Infrastructure and Transport and the Seoul Metropolitan Government on real estate policy, Mayor Oh stated, "I am aware of concerns about policy discrepancies between the central government and the Seoul Metropolitan Government," and explained, "Fundamentally, I believe our perspectives are the same, but the government is focused on curbing demand, while the city is focused on increasing supply."

He added, "We have been continuously requesting that obstacles to redevelopment projects be removed."