KOR[Anchor]
It has been a week since the government announced its tax law revision proposal, but the fallout remains intense. To achieve the intended effects of the revision, the government is caught in a complicated situation where it has no choice but to continuously grant exceptions to existing regulations.
Reporter Lee Seong-hoon has the details.
[Reporter]
An apartment complex in Songpa-gu, Seoul.
Since the announcement of the tax revision plan, there have been moves to put properties on the market, but the atmosphere suggests it is not easy to actually lead to transactions due to various restrictions.
[Songpa-gu Real Estate Agent, Seoul: You could say there are situations where sellers cannot sell houses even if they want to because a lot of lease periods are left. There are many such cases. You can consider that there are many people who cannot sell due to those circumstances even if they want to.]
In this tax revision plan, the government announced a policy to temporarily lower the heavy capital gains tax rate for owners of multiple homes to increase housing supply on the market.
However, in land transaction permission zones, including all of Seoul and 15 areas in Gyeonggi Province, buyers are required to move in and live there directly within four months of receiving permission.
As complaints mounted that it is difficult to find buyers for homes with tenants whose lease periods have a long time remaining even if owners want to sell, the government is belatedly considering extending the grace period for the actual residency obligation for homes with tenants within transaction permission zones until 2028.
This means the government is tinkering once again with the actual residency obligation rule, which had already been postponed once until the end of the year ahead of the heavy capital gains tax enforcement for multi-home owners back in May.
The same applies to single-home owners who do not reside in their properties.
Amid strong backlash against the residency recognition requirements, authorities are discussing additional recognitions for cases such as caring for grandchildren and expanding the recognized scope of the residency period, which is currently set at three years.
The elimination of the limit rollover and the shortening of the contract period for general Individual Savings Accounts (ISAs) are also being reviewed for supplementation.
[Kim Woo-cheol / Professor of Taxation, University of Seoul: It is a situation where exceptions are increasing because criticism follows, and if you keep increasing exceptions, it really becomes completely impossible to understand why this was done in the first place. Trust in government policy is bound to be significantly weakened.]
As revisions and supplementary measures have become necessary one after another just a week after the announcement, criticisms are rising that the preparation may not have been sufficient.
The ruling party and the government plan to gather opinions until the end of this month to make final adjustments to the tax revision plan.
(Video editing: Kim Jong-mi | VJ: Jeong Han-wook)
※ Please note: This article was translated by AI and may contain errors.
