Former Legislation Officer Lee Seok-yeon and Legal Experts Claim "Increase in Comprehensive Real Estate Tax is Unconstitutional"

Former Chief of the Legislative Affairs Office Lee Seok-yeon / Photo by Yoon Dong-ju doso7@

[Asia Economy Reporter Lee Chun-hee] Former Chief of the Legislation Office Lee Seok-yeon and other legal professionals are forming a defense team to file a constitutional complaint against the Comprehensive Real Estate Holding Tax (종부세, Jongbu-se).

The defense team for the unconstitutionality lawsuit against the Jongbu-se held a press conference on the morning of the 22nd at the large conference room of the law firm Yeollim in Gangnam-gu, Seoul, announcing their plan for a "constitutional lawsuit against the unconstitutional Jongbu-se."

They stated, "Due to the government's real estate policy changes made 24 times, housing prices have skyrocketed, and the government's artificial increase of publicly announced property prices for the purpose of tax hikes has recently caused a sharp increase in the Jongbu-se burden on citizens," adding, "such an unexpected rapid increase in taxes violates the principles of legality of taxation, equitable taxation, rule of law, and proportionality, infringing on citizens' property rights, which is unconstitutional."

Former Chief Lee warned, "We must be cautious of the politicization of the economy," criticizing, "A representative area is real estate and tax policy, where the current government has been focused on attacking the middle class under the slogans of wealth redistribution, equality, and welfare." He claimed that this process caused policy failures leading to rising housing prices and confusion in the rental market, and that the government has collected enormous taxes from the people to cover this up.

He continued, "Most Jongbu-se taxpayers suffering from the tax measures are not vested interests or high-income groups but ordinary people who have complied with government policies and worked steadily to live a little better throughout their lives," and questioned, "Have the policymakers ever considered the frustration felt when these ordinary people perceive that their hard-earned property has been violated due to unconstitutional and retaliatory tax policies that ignore the principle of ability-to-pay and impose excessive tax burdens?"

Regarding the current Jongbu-se laws, they argued that ▲the types and rates of taxes should be determined by the National Assembly, but the government, merely an executor of laws, imposes Jongbu-se and property tax by arbitrarily raising the tax base without legislative procedures, violating the principle of legality of taxation; ▲Jongbu-se and property tax are not taxes on realized gains, so applying progressive rates is inappropriate, yet the government imposes and collects taxes by differentially increasing the publicly announced price reflection rate for houses over 900 million KRW, violating the principle of equitable taxation; ▲the artificial and rapid increase of the tax base forces citizens to bear excessive taxes that are difficult to cope with, infringing on the principles of trust protection and legal stability, thus expecting an unconstitutional ruling.

They also claimed that while taxpayers of commercial real estate can pass on the tax burden as costs, residential real estate taxpayers cannot, yet the tax base is uniformly set regardless of use, and differential taxation solely because of multiple home ownership violates the principles of ability-to-pay and proportionality. Furthermore, since residential housing is subject to both holding tax and capital gains tax upon disposal, imposing excessive double taxation infringes on property rights and is unconstitutional.

The defense team consists of 10 legal professionals, including former Chief Lee, former Chief Research Officer of the Constitutional Court Bae Bo-yoon, and former Chairman of the Korea Legal Aid Corporation Lee Heon. Additionally, seven advisors, including former Blue House Political Secretary Son Gyo-myeong, Yonsei University Special Professor Kim Jeong-ho, and former Seoul Central District Court Chief Judge Lee Ki-hyun, are participating.

They plan to recruit petitioners from today until February next year and then submit a tax appeal. If no decision is made within 90 days after the tax appeal, they will file an administrative lawsuit and request a constitutional review of the law.

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