Petition Against Expansion of Stock Transfer Tax Claims "The Ladder to Middle Class Is Cut Off"

Individual Investors Express Complaints Through Blue House National Petition

The government announced that starting in 2023, individual investors who earn more than 20 million won annually from all domestic listed stocks and funds will be taxed 20% on the amount exceeding 20 million won, sparking strong dissatisfaction among individual investors. Photo by Cheongwadae National Petition Board capture

[Asia Economy Kim Bong-ju Intern Reporter] The government announced that starting from 2023, individual investors who earn more than 20 million KRW annually from all domestic listed stocks and funds will be taxed 20% on the amount exceeding 20 million KRW, sparking strong complaints from individual investors.

On the 24th, a petition titled "The Expansion of Stock Capital Gains Tax is Unfair" was posted on the Blue House National Petition Board.

The petitioner introduced themselves as "a citizen of the Republic of Korea using stocks as a financial investment tool" and lamented, "In our country, the way for ordinary people to become middle class is through financial investments like real estate and stocks. However, the June 17 real estate measures took away one ladder for ordinary people to reach the middle class, and although the remaining ladder (stocks) is risky, the President has cut off even that remaining ladder."

They continued, "Unlike the US, which attracts global capital, the domestic stock market has been in a box range for over 10 years because foreign funds and domestic cash-rich investors have not flowed in. This is because of the high risk and lack of advantages," pointing out the limitations of the Korean stock market.

They argued, "For Korea to become an Asian financial hub like Hong Kong, policies to ease capital gains tax must never be implemented." They suggested increasing the capital gains tax threshold to 5 billion or 10 billion KRW units to attract cash-rich investors and enable the domestic stock market to grow.

The petitioner urged, "Rather than providing emergency disaster relief funds, please reduce individual income tax, corporate tax, and real estate capital gains tax."

Photo by Cheongwadae National Petition Board

Another petition was also raised. On the 25th, a petitioner posted an article titled "Impose Stock Capital Gains Tax Only on Major Shareholders," writing, "The participation of individual investors, called 'Donghak Ants,' has revitalized the domestic stock market, which had been stagnant for years."

This petitioner also said, "Ordinary people with small capital find it difficult to invest in the overheated real estate market," adding, "The stock market is almost the only investment option for ordinary people."

The petitioner appealed, "Impose capital gains tax only on major shareholders," saying, "It was a stock market where individual investors smiled after a long time. We should not dash the hopes of ordinary people. It is disappointing."

On the same day, the government announced plans to expand the capital gains tax on listed stocks, which has been limited to major shareholders since 2020, to small shareholders as well, and to gradually reduce the securities transaction tax rate.

Capital gains up to 20 million KRW will be tax-exempt, but amounts exceeding that will be taxed at 20%. A 25% tax rate will apply to amounts exceeding 300 million KRW.

However, the current securities transaction tax of 0.25% will be reduced by 0.02 percentage points in 2022 and by 0.08 percentage points in 2023.

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