Minju: "We will block the Yoon administration's 'super-rich tax cuts' on corporate tax, capital gains tax, and comprehensive real estate tax as party policy"

Holding a Party Meeting to Adopt Party Policy
Blocking '13 Trillion Won' Tax Cuts to Promote Public Welfare Policies

[Image source=Yonhap News]

[Asia Economy Reporter Park Jun-yi] The Democratic Party of Korea has adopted a party stance to block the tax cut policies promoted by the Yoon Seok-yeol administration, including corporate tax, capital gains tax on stocks, and comprehensive real estate tax on multi-homeowners. The intention is to prevent the implementation of tax cuts amounting to 13 trillion won and redirect those funds into policies for the people's livelihood.

The Democratic Party announced this after holding a party meeting at the National Assembly on the 22nd. On that day, party members held placards saying "Withdraw the ultra-rich tax cuts" and "Expand the livelihood budget" while chanting slogans.

Floor Leader Park Hong-geun stated, "Regarding the three ultra-rich tax cut items related to corporate tax, capital gains tax on stocks, and the comprehensive real estate tax heavy taxation on multi-homeowners, we have adopted a party stance to block them and not agree to the legislative amendments, and we plan to review this going forward."

In response, Policy Committee Chair Kim Seong-hwan said, "Since the beginning of the Yoon administration, economic policies have mainly focused on tax cuts, and as fiscal revenue decreased, there has been a tendency to compensate by privatization or selling state-owned assets," adding, "This is contrary to global trends."

He then referred to the U.S. Inflation Reduction Act (IRA), explaining, "The U.S. is investing 500 trillion won through subsidies to companies and individuals in sectors like electric vehicles, solar power, and wind power to attract manufacturing and climate-related industries domestically. This is a global trend," and added, "Claiming that tax cuts for the rich are a global trend is misleading the public."

[Image source=Yonhap News]

Specifically, regarding corporate tax cuts, he said, "In the early days of the Moon Jae-in administration, the top corporate tax rate was raised from 22% to 25%, but only for companies earning more than 300 billion won annually," adding, "Such companies number about 84 out of approximately 840,000 corporations in total." He criticized, "This corresponds to 0.01% of corporations, and the tax is imposed on companies with over 300 billion won in profits after paying employee salaries. The current government's corporate tax cut policy aims to reduce this tax."

Regarding capital gains tax cuts on stocks, he explained, "From next year, a system was to be applied to tax individuals earning over 50 million won through financial investments, with losses offset against gains later. Instead of implementing this, the government plans to postpone it for two years and raise the non-taxable threshold from 1 billion won to 10 billion won," adding, "The 10 billion won non-taxable threshold was set 20 years ago and gradually lowered to 1 billion won, but now they want to revert it 20 years back, which is a highly regressive policy."

On the reduction of comprehensive real estate tax for multi-homeowners, he said, "For two-homeowners, there is a slightly progressive policy depending on the property value, and for three-homeowners, the progression is more severe," adding, "Most three-homeowners are likely for speculation or investment rather than for ownership purposes, so cutting taxes for them directly contradicts the intent to prevent unearned income through real estate holdings."

Policy Committee Chair Kim emphasized, "Including these three representative ultra-rich tax cuts, the total scale of tax cuts amounts to about 13 trillion won per year, or about 60 trillion won over five years," and stressed, "There are many livelihood policies that need to be addressed. Securing funds by blocking ultra-rich tax cuts makes it entirely possible."

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