[Asia Economy reporters Lee Ji-eun and Koo Chae-eun] The Blue House has once again urged a cautious approach to the plan proposed by Lee Jae-myung, the Democratic Party presidential candidate, and currently being pushed by the party, to postpone the heavy capital gains tax on multiple homeowners, saying it "encourages demand." It appears that the Blue House, which wants to maintain its policy stance, and the presidential candidates, who are trying to win public favor regarding the hot-button issue of "real estate taxes" in the presidential race, are out of sync.
On the morning of the 16th, Lee Ho-seung, director of policy at the Blue House, appeared on a radio program and said, "Since the housing market is at a sensitive turning point, discussions on fundamentals such as the 'heavy capital gains tax on multiple homeowners' should be cautious, and efforts should focus on market stabilization." The day before, Lee Cheol-hee, senior secretary for political affairs at the Blue House, also conveyed the Blue House's opposition to the postponement of the heavy capital gains tax to the party. They have been putting the brakes on for two days straight.
Comparing to the end of November when a downward trend in the real estate market was forecasted, Lee said, "It now seems to have entered a further phase of downward stabilization," but expressed concern that considering a postponement of the heavy capital gains tax on multiple homeowners at this point "could send mixed signals to the market."
The discussion on easing the capital gains tax was triggered when candidate Lee mentioned during his visit to POSTECH in Gyeongbuk on the 13th, "If eased as an emergency measure and then restored after a certain period, increasing the capital gains tax burden, it is judged that housing supply could come out." However, the next day, floor leader Yoon Ho-jung expressed a cautious view, saying, "There is also an opinion that (the effect of housing supply) is not significant," which added to the confusion. Lawmakers Jin Sung-jun and Kang Byung-won, classified as pro-Moon Jae-in, also officially expressed opposition.
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The Democratic Party plans to hold a party meeting as early as next week to discuss candidate Lee's key real estate policies. A member of the election committee said, "The candidate is in the process of gathering opinions on easing the capital gains tax," adding, "The party will be able to finalize its position after a deliberation process through the party meeting."
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