[Column] Ministry of Land, Infrastructure and Transport Invites Distrust... Controversy Over 'Faulty Officially Announced Property Prices'

[Asia Economy Reporter Moon Jiwon] "Every year, as the publicly announced prices rise sharply, the burden of holding taxes has also increased, but it's absurd that the publicly announced prices calculated so far are nonsense." (Office worker A, Mapo, Seoul)

On the 19th, when the Board of Audit and Inspection revealed that there were numerous deficiencies in the Ministry of Land, Infrastructure and Transport's process of calculating the publicly announced prices for land and detached houses, the industry responded with "what was bound to happen has happened."

In fact, controversies over the fairness of publicly announced prices and the resulting dissatisfaction have existed for a long time. This is because the publicly announced prices often showed significant differences from market prices and varied widely even for similar land in neighboring areas.

Nevertheless, the Ministry of Land, Infrastructure and Transport, the competent authority, has been negligent in improving the system to enhance accuracy and fairness, and audits have not been conducted for a long time since the introduction of the housing price public announcement system in 2005. The long-standing deficiencies in publicly announced prices revealed by this Board of Audit and Inspection investigation can be seen as something the government essentially brought upon itself.

As the causes of the imbalance in publicly announced prices and suspicions of discrepancies with market prices, which have been pointed out repeatedly, were revealed by the Board of Audit and Inspection investigation, the Ministry of Land, Infrastructure and Transport, which has been sharply raising publicly announced prices every year, is also internally tense. The public sentiment against the burden of holding taxes is already strong recently, and there is a possibility that complaints about having paid unfair taxes due to the government's faulty administration will increase further.

In fact, according to the Board of Audit and Inspection report, there were 1.44 million cases, accounting for 37% of the total, where different departments calculated individual publicly announced land prices and individual housing prices even within the same local government, resulting in different prices for the same land. There were also 228,475 cases where the combined price of land and house was lower than the land price alone.

Perhaps because of this, the Ministry of Land, Infrastructure and Transport hurriedly issued an explanatory press release immediately after the Board of Audit and Inspection's announcement to contain the situation. A Ministry official said, "The Board of Audit and Inspection did not announce that the publicly announced prices were wrong, but that there were inconsistencies in characteristics," adding, "Even if some characteristics are corrected, the actual impact on prices is minimal." This nuance differs somewhat from the "gradual improvement" stance expressed in the Board of Audit and Inspection's audit report's related agencies' opinions and press release.

The Ministry of Land, Infrastructure and Transport said last year that it would correct the erroneous publicly announced prices and refund the over-collected taxes, but among the public who have paid taxes based on 'nonsense publicly announced prices' for over a decade, there is dissatisfaction that "we cannot trust the government either." The industry even points out that the Ministry's poor calculation of publicly announced prices is not a temporary "accident" caused by the deviation or mistake of a few officials, but a systemic flaw revealed amid government incompetence and neglect.

For the Ministry of Land, Infrastructure and Transport to raise the realization rate of publicly announced prices as originally intended by the government policy and improve the fairness of the tax system, a rational calculation system, transparency, and communication with the public must come first. Although the "Measures to Enhance the Reliability of Real Estate Publicly Announced Prices" were announced on December 17 last year and many unreasonable parts were improved, the public response is that it is still insufficient.

As it stands, with about 430,000 parcels of land registered in the land ledger omitted from individual publicly announced land price calculations, and despite similar areas and land uses, due to local government errors, some people face increasing tax burdens every year while others pay the same taxes for decades, the Ministry of Land, Infrastructure and Transport cannot explain the justification for the sharp rise in publicly announced prices to the public.

This content was produced with the assistance of AI translation services.