Ruling Party Tables and Passes 'Real Estate Law' in Half a Day... United Party Protests and Walks Out

[Image source=Yonhap News]

[Asia Economy Reporter Kim Hyemin] On the 28th, the Democratic Party of Korea unilaterally submitted and passed follow-up bills related to the July 10 real estate measures at the National Assembly standing committee. They skipped discussions at the subcommittee level and processed the bills within half a day. The intention is to speed up the real estate measures by finalizing the bills at the plenary session on the 4th of next month. The United Future Party immediately opposed and refused to review the bills.

The National Assembly's Land, Infrastructure and Transport Committee, the Strategy and Finance Committee, and the Public Administration and Security Committee held full committee meetings that day and submitted and approved real estate-related tax laws focusing on tax increases for multi-homeowners.

At the Land Committee, the Real Estate Transaction Reporting Act and the Reconstruction Excess Profit Recovery Act, which are part of the three lease laws, were approved. The Real Estate Transaction Reporting Act requires that contract details such as the parties to the lease contract, deposit, rent, and lease period be reported to the city, county, or district office within 30 days, providing the basis for the monthly rent transaction reporting system.

The right to request contract renewal and the rent ceiling system, among the three lease laws, are included in the "Housing Lease Protection Act Amendment." This bill was submitted to the Legislation and Judiciary Committee the day before. Normally, a subcommittee would be formed through consultation between the ruling and opposition party floor leaders for discussion before submitting it to the full committee, but the Democratic Party may hold a full committee meeting on the 29th and pass it immediately.

At the Public Administration and Security Committee, the Local Tax Act amendment bill, which includes the acquisition tax rate increase announced in the July 10 real estate measures, was processed. The bill raises the acquisition tax rate when acquiring houses in regulated areas by gift or when corporations and multi-homeowners acquire houses. The acquisition tax rate is increased to 8% for two-homeowners and 12% for corporations and those owning three or more homes. The acquisition tax rate for luxury houses and villas subject to heavy taxation is applied up to a maximum of 20%.

At the Strategy and Finance Committee, the Comprehensive Real Estate Holding Tax Act (종부세법), the Income Tax Act including capital gains tax increases, and the Corporate Tax Act were processed. According to the bill, the comprehensive real estate holding tax rate for those owning three or more homes and two-homeowners in regulated areas was raised from the previous 0.6?3.2% to 1.2?6%. The capital gains tax burden was also increased, raising the capital gains tax surcharge rate applied when selling houses for those owning two or more houses in regulated areas by 20 percentage points for two-homeowners and 30 percentage points for those owning three or more homes.

[Image source=Yonhap News]

It is unusual for a bill to be submitted and approved within a day without going through a subcommittee. The Democratic Party forcibly processed the bill, citing the need to push forward the real estate measures quickly.

The United Future Party protested the ruling party's "surprise" submission and walked out entirely. Ryu Seong-geol, the United Future Party floor leader of the Strategy and Finance Committee, said, "Following the Blue House's instructions, only specific lawmakers' bills were submitted and pushed through by vote without proper discussion," and "They fundamentally blocked the National Assembly's discussion on the bill." Lawmaker Cho Hae-jin also raised his voice, saying, "Carefully reviewing bills through the subcommittee is an essential legislative process," and "Is the ruling party's National Assembly operation strategy to make us sit like rubber stamps without giving us the basic duty to review the agenda?"

Lee Heon-seung, the United Future Party floor leader of the Land Committee, also protested, saying, "The Democratic Party ignored the first-in, first-out principle and submitted only bills they liked, destroying parliamentary democracy."

On the other hand, the Democratic Party argues that since the United Future Party has opposed real estate-related tax increases, it would have been difficult to reach an agreement from the start. Kim Kyung-hyup, a Democratic Party lawmaker from the Strategy and Finance Committee, justified the forced passage by saying, "Isn't it that the United Future Party had no intention of reviewing it from the beginning? Aren't they outright opposing the bill itself?"

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