Property Tax Rate Reduced by 0.05%p for Single-Homeowners with Officially Assessed Value Under 900 Million Won... 'Local Tax Act Amendment' Passed

Special Property Tax Rate Application Expanded from Houses Under 600 Million KRW to Those Under 900 Million KRW
Seo Young-kyo, Chair of the Public Administration Committee, "Significant Increase in Tax Burden Due to This Year's Rise in Official Housing Prices"
"Property Tax Reduction Expected to Contribute to Residential Stability for Low-Income Citizens"
Property Tax Relief of Approximately 200,000 to 270,000 KRW for Multi-family Houses Valued Between 600 Million and 900 Million KRW

[Asia Economy Reporter Oh Ju-yeon] A property tax reduction bill that reduces the property tax rate by 0.05 percentage points for houses in the official price range of 600 million to 900 million KRW has passed the National Assembly standing committee. The main point is the expansion of the special property tax rate, which was previously applied to houses priced at 600 million KRW or less, to houses priced at 900 million KRW or less. With the passage of this bill, the property tax burden on apartment houses priced between 600 million and 900 million KRW is expected to be reduced by approximately 200,000 to 270,000 KRW.

Seo Young-kyo, a member of the Democratic Party of Korea, is speaking during the government economic inquiry held at the National Assembly plenary session on the 20th. Photo by Yoon Dong-joo doso7@

On the 23rd, the National Assembly's Public Administration and Security Committee held a plenary session and processed the 'Partial Amendment to the Local Tax Act.' This bill includes provisions to expand the special property tax rate application for one household, one house from the current official price of 600 million KRW or less to 900 million KRW or less, thereby reducing the property tax burden on citizens.

The Democratic Party confirmed as a party stance last month on the 27th a property tax relief plan that reduces the property tax rate by 0.05 percentage points for houses in the official price range of 600 million to 900 million KRW.

The special property tax rate for one household, one house was introduced as a property tax burden relief measure announced during the establishment of the real estate official price realization plan in November last year. It was reflected in the amendment of the 'Local Tax Act' in December 2020 and applied for three years from the 2021 property tax imposition to the 2023 property tax imposition. The plan is to reconsider whether to extend it in the future, considering changes in the housing market and the effects of the official price realization promotion.

Source: Office of Assemblyman Seo Young-kyo

Originally, single-homeowners with an official land price of 600 million KRW or less were expected to see a reduction in property tax burden compared to the previous year because the special tax rate reduction effect lowered the housing property tax by 22.2% to 50.0%, which was greater than the increase effect caused by the rise in official prices (tax burden cap 5-10%). However, this year, the official price change rate for apartment houses reached 19.05%, raising concerns that property tax for single-homeowners would increase. Additionally, about 273,000 apartment houses priced at 600 million KRW or less, which could apply the special tax rate until last year, are excluded from the special tax rate application, strengthening the need to expand the property tax reduction target.

If the amendment passed by the Public Administration and Security Committee plenary session passes the National Assembly plenary session in June, an additional 440,000 single-homeowners will have their property tax burden eased, and the property tax burden for single-homeowners owning houses priced between 600 million and 900 million KRW is expected to decrease by about 200,000 to 270,000 KRW.

Seo Young-kyo, chairperson of the Public Administration and Security Committee, stated, "Due to this year's increase in official housing prices, the tax burden has significantly increased. Expanding the special property tax rate application target from 600 million KRW to 900 million KRW will achieve the effect of reducing property tax and contribute to stabilizing housing for ordinary citizens."

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