The government decided to keep the basic deduction for the comprehensive real estate tax for nonresidents with one home at 1.2 billion won. It also planned to cut the per-person basic deduction for a nonresident one-home jointly titled by a married couple from 900 million won to 400 million won, but decided to revert it to the midpoint of 600 million won. It said it will also freeze the cap on tax burden at 150% without raising it. However, this is the government's plan and could change during the National Assembly's review.
On the 1st, the Ministry of Finance and Economy said it finalized the "2026 tax reform plan" at a Cabinet meeting. The ministry plans to submit 11 tax amendment bills, including the comprehensive real estate tax act, passed that day to the National Assembly by the 3rd.
Initially, in the tax reform plan released last month, the government raised the basic deduction for one-home owners for the comprehensive real estate tax from 1.2 billion won to 1.4 billion won, while deciding to lower it for nonresidents from 1.2 billion won to 900 million won.
As public backlash grew, it prepared a revision to keep the basic deduction at 1.2 billion won for nonresidents with one home. It also planned to reduce the basic deduction for nonresident dwellings jointly titled by a married couple from the current 900 million won each to 400 million won, but decided to lower it to the midpoint level of 600 million won.
In addition, it had decided to raise the cap on the comprehensive real estate tax burden from the current 150% to 200% next year, but chose to keep it at the current level.
Meanwhile, the government is expected to expand the exceptions under which nonresidents are recognized as residents during the process of revising the enforcement decree. Under the existing government plan, if a person relocates their residence for one year or more due to schooling, a job change or transfer, illness, school transfer, overseas stay, or caring for parents, up to three years can be recognized as a residence period. It may add reasons such as caring for grandchildren and children's education.