Hong Nam-ki: "Only 1% of the People Pay the Comprehensive Real Estate Holding Tax"... Refuting the 'Tax Bomb' Claim

Government Questioning at the National Assembly on the 23rd

Hong Nam-ki, Deputy Prime Minister and Minister of Economy and Finance, is delivering opening remarks at the "11th Emergency Economic Central Countermeasures Headquarters Meeting and 1st Korean New Deal Related Ministers' Meeting" held at the Government Seoul Office in Jongno-gu, Seoul on the 23rd. Photo by Kang Jin-hyung aymsdream@

[Sejong=Asia Economy Reporter Kim Hyunjung] Hong Nam-ki, Deputy Prime Minister for Economy, on the 23rd refuted the 'tax bomb' controversy surrounding the recently announced tax reform by stating, "The comprehensive real estate holding tax is paid by only 1% of the entire population."

During the government questioning session at the National Assembly on the same day, in response to a question from Yoon Hoo-deok, a member of the Democratic Party of Korea, asking for a self-assessment of the July 10 real estate measures, Deputy Prime Minister Hong said, "In the case of the comprehensive real estate holding tax, only 1% of the total population and 2% of households pay it." He added, "98% of apartment complexes do not bear the comprehensive real estate holding tax," and "especially, the subjects announced on the 10th for additional taxation are multi-homeowners, which is a tailored measure applicable to only 0.4% of the total."

He also expressed a commitment to strengthening protection for actual demanders with one household and one house. Deputy Prime Minister Hong said, "Recently, we increased the comprehensive real estate holding tax deduction benefits for the elderly and long-term holders, and in the case of capital gains tax, we announced policies to ease the tax burden for one-household-one-house owners by expanding the special deduction rate up to 80%." He explained, "Regarding the case of temporary two houses with one house and one pre-sale right, we initially intended to treat it as two houses and take measures, but since innocent victims could occur, we announced on the 22nd that temporary two houses would be recognized," adding, "We will ensure protective measures when revising the related enforcement decree."

In response to Representative Yoon's remark that loan regulations through Loan-to-Value ratio (LTV) and Debt-to-Income ratio (DTI) should be coordinated between banks and the market, he replied, "Regarding taxes, we are making measures under the policy direction of raising holding taxes while lowering transaction taxes, but I believe that leaving LTV or DTI regulations solely to banks has significant side effects," and added, "Rather than the government directly regulating loans, most cases are adjusted by designating regulated areas."

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