The Ministry of Economy and Finance said on the 20th that it would be difficult to push ahead within the year with a real estate tax overhaul, including raising holding taxes.
Spokesperson Kang Young-gyu said this at a regular briefing held at the Ministry of Economy and Finance press room at the Government Complex Sejong, noting with regard to the holding and transaction tax adjustment plan mentioned in the Oct. 15 real estate measures, "I asked the Tax Policy Office, and they said they haven't even started (the research project)."
In response to a follow-up question, "Does saying the direction of the tax overhaul can be known only after the research project is finished mean the overhaul will slip into next year?" Kang said, "Of course, doesn't it?"
To the continued question, "Even if the tax system is overhauled, does that mean nothing will come out within the year?" Kang said, "That's likely," adding, "There is also the National Assembly audit, so the research project procedures will only proceed in November. Given that it takes at least a few months, it will probably be around next year."
However, to the question, "Will it be included in next year's tax law amendment bill?" Kang said, "I have never mentioned a specific time plan (schedule)."
Kang also addressed a remark related to holding taxes made by Koo Yun-cheol, Deputy Prime Minister and Minister of the Ministry of Economy and Finance, during a visit to the United States, saying, "He cited the United States' 1% property tax as an example, and it doesn't make sense to judge that the deputy prime minister holds a particular position," adding, "I want to make it clear that it is not the deputy prime minister's position."
Earlier, Deputy Prime Minister Koo said, "If, like in the United States, you hit property tax at (an average) 1%, then for a 5 billion won house you would have to pay 50 million won a year. Fifty million won is about half of an average annual salary, and it shouldn't be like that."
However, it is not clearly confirmed whether the phrase "it shouldn't be like that" in the remark means that from the holder's perspective they would not be able to endure the holding tax and would put dwellings on the market, or that holding taxes should not be imposed excessively.
On this, Deputy Prime Minister Koo told ChosunBiz by phone, "I did not make the remark with a particular side in mind," adding, "Strengthening holding taxes could stabilize the real estate market, but I also think imposing taxes too heavily and creating a burden is not right."