The Democratic Party Pushes to Revive the Land Ownership Cap System Ruled Unconstitutional

Lee Nak-yeon Proposes Three Laws to Regulate Land Monopoly

[Asia Economy Reporter Oh Ju-yeon] Former leader and Democratic Party presidential candidate Lee Nak-yeon proposed the Three Land Monopoly Regulation Acts (Amendments to the Land Ownership Limit, Development Profit Recovery Act, and Comprehensive Real Estate Tax Act) on the 15th.

Presented as a solution to the deepening asset income gap and resulting inequality, Lee's key pledge draws attention for reviving the land ownership limit system for the first time in 22 years.

In this proposal, Lee revived the "Land Ownership Limit Act," which disappeared following the Constitutional Court's ruling of unconstitutionality in 1999. Before the ruling, the Land Ownership Limit Act restricted individuals from owning more than 660㎡ (approximately 200 pyeong) of land in Seoul and metropolitan cities. However, Lee's bill allows ownership up to 1,320㎡ (about 400 pyeong), and if the owner resides there for more than five years, ownership can extend up to 2,000㎡ (about 605 pyeong), expanding the maximum area an individual can hold by up to three times.

[Image source=Yonhap News]

For land outside Seoul or metropolitan cities, ownership is allowed up to 2,500㎡ (about 756 pyeong) with more than five years of residence, and up to 3,000㎡ (about 907 pyeong) in other regions.

Additionally, the excess ownership surcharge is designed to be imposed at rates between 2% and 9%, accumulating up to 51% over a maximum of eight years. This measure takes into account the 1999 Constitutional Court ruling that deemed the indefinite imposition of excess ownership surcharges at 4% to 11% annually based on official land prices as unfair.

Alongside this, Lee also proposed an amendment to the Development Profit Recovery Act to increase the burden rate on development profits from the current 20-25% to a maximum of 50%.

Finally, the Comprehensive Real Estate Tax Act was amended to allow additional taxes on idle land held by individuals or corporations, reviving the spirit of the Land Excess Profit Tax Act abolished during the 1998 foreign exchange crisis.

Lee's goal with the Three Land Monopoly Regulation Acts is for the Land Bank to purchase and stockpile land parcels and idle land that come onto the market, thereby increasing the proportion of national and public land, which currently stands at only 33.6%. Using this land, he plans to raise the share of public rental housing from the current 7.4% to the OECD average of 20%.

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