Guri City Welcomes National Assembly Passage of 'Partial Amendment to the Restriction of Special Taxation Act'

Expansion of Compensation Benefits for Landowners
in Projects such as Guri Topyeong 2 Public Housing District Development

The city of Guri, Gyeonggi Province (Mayor Baek Kyung-hyun) announced on the 5th that with the passage of the 'Partial Amendment to the Restriction of Special Taxation Act' at the National Assembly plenary session on February 27, the capital gains tax reduction benefits for residents whose land is expropriated for public interest projects such as the Guri Topyeong 2 Public Housing District Development Project will be expanded.

Guri City Hall exterior. Provided by Guri City

According to Guri City, through this legal amendment, if the ongoing preliminary feasibility studies for the Guri Topyeong 2 Public Housing District Development Project and the Sanodong E-commerce New Growth Complex City Development Project pass and are confirmed, residents whose land is expropriated in these areas will be eligible for capital gains tax reduction benefits.

Specifically, the capital gains tax reduction rate for public interest projects has been increased by 5 percentage points: for cash compensation, from 10% to 15%; for bond compensation, from 15% to 20%; for long-term held bonds (over 3 years), from 30% to 35%; and for holdings over 5 years, from 40% to 45%.

Additionally, the capital gains tax reduction limit has been raised. Previously, the maximum reduction limit per taxable period (1 year) was 100 million KRW, but with this amendment, it has been expanded to 200 million KRW. The reduction limit for compensation received over a long period, such as five consecutive years, has also increased from 200 million KRW to 300 million KRW.

Mayor Baek Kyung-hyun proposed at the policy meeting among 31 mayors and county heads of Gyeonggi Province in November last year that the capital gains tax exemption clause for public interest projects, as applied before the 1989 amendment of the 'Tax Reduction Regulation Act,' be reinstated to fully exempt capital gains tax. If full exemption is difficult to implement immediately, he requested as an alternative to increase the capital gains tax reduction rate.

Mayor Baek stated, “Although it is not fully satisfactory that capital gains tax exemption for public interest projects is not yet implemented, through this legal amendment, if the Topyeong 2 district and the Sanodong E-commerce development project, which is undergoing preliminary feasibility studies, are confirmed, residents will be able to receive expanded capital gains tax reduction benefits. This is expected to protect the property rights of citizens cooperating with public interest projects and reduce disputes that may arise during the process.” He added, “We will also work with the Ministry of Land, Infrastructure and Transport and LH to prepare resident support measures and plans for the resettlement of original residents.”

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