Kim Yongbeom: "Bonuses May Flow into Real Estate Market... Normalization of Taxation Needed"

"Unprecedented Semiconductor Boom" Should Not Benefit Only a Few
Imagination Needed to Connect Gains to Vulnerable Groups and Future Industries

Kim Yongbeom, policy chief at the Blue House, assessed the current Korean economic situation as an "unprecedented boom" on June 20, and stated that imagination and execution are needed to channel corporate profits and fiscal resources toward vulnerable groups and future industries, alongside the normalization of real estate taxation.

Yonhap News

On his Facebook page the same day, Kim said, "People see positive numbers in the news, but they don't necessarily feel that these are connected to their own lives. However, the mood could change significantly in the second half of the year. Luxury consumption is likely to rebound, and buying sentiment for real estate in preferred areas could also start to stir again. The real turning point will be at the end of the year and early next year."

Kim noted, "When bonuses are paid, wage increases become a reality, and export earnings begin to flow into the domestic market in earnest, people's behavior changes. Looking back, such funds have repeatedly tended to flow into the real estate market."

He added, "Real estate taxation needs to be normalized. Adjusting both property holding taxes and capital gains taxes in a reasonable way is necessary and the right direction." He then posed the rhetorical question, "But will that alone be enough?" and continued, "If people become convinced that they can still make a profit even after paying taxes, even considerable regulations may not be enough."

Regarding potential interest rate hikes, Kim said, "Self-employed individuals, vulnerable borrowers, and those with variable-rate loans who do not feel the effects of the boom are likely to be the first to struggle. The gains from the boom rise to the top, while the pains of tightening trickle down. This is the most uncomfortable scenario."

Kim also remarked, "If the national wealth generated by semiconductors is absorbed as windfall profits in real estate and the benefits of growth are concentrated only among a few, this boom will not last long. Conversely, if fiscal resources and corporate profits can be connected to youth, vulnerable groups, and future industries, this boom could become the starting point for Korea's economy to emerge from the long tunnel of low growth."

Previously, last month, Kim also proposed a "national dividend system" to return excess tax revenue to the public, stating, "The fruits of the AI infrastructure era are not the achievements of a single company alone."

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