Pro-Government Bloc Protests Democratic Party's Revised Real Estate Tax Plan as a 'Tax Cut for the Rich'

Press Conference by Cho Kuk Innovation Party and Others

"Changing Jongbu-se Taxation Threshold Will Greatly Reduce the Number Subject to Tax"

Regarding next year's proposed tax reforms, voices of opposition have emerged from the ruling bloc, including the Democratic Innovation Party, criticizing the measures as "tax cuts for the wealthy." This backlash is due to not only raising the threshold for the comprehensive real estate tax (Jongbu Tax) from 1.2 billion won to 1.4 billion won, but also to the government's indication that it will retract its plan to tax non-residents.

On August 27, the Democratic Innovation Party, Progressive Party, Social Democratic Party, Basic Income Party, and the Citizens' Coalition for Economic Justice held a joint press conference to raise concerns about the real estate-related tax reform currently being discussed by the government and the Democratic Party. Lawmakers Whang Woonha, Cha Gyugeun, and Kim Sunmin of the Innovation Party; Yong Hyein, floor leader of the Basic Income Party; Assemblywoman Jeong Hye-kyung of the Progressive Party; and other civil society representatives asserted that "the government's real estate tax reform proposal must not be allowed to backtrack by reducing taxes for high-value property owners."

Assemblyman Cha pointed out, "If the comprehensive real estate tax is applied based on a 1.4 billion won threshold, 75,803 homes nationwide—including 56,870 in Seoul alone—will be excluded from taxation." Assemblyman Whang stated, "What should be discussed first is not the distinction between residents and non-residents, but rather how to set an appropriate taxation standard for high-value real estate." He added, "Excluding even homes with a market value of around 2 billion won from the Jongbu Tax and reducing tax liability for homes worth 3 billion won essentially amounts to a tax cut for wealthy property owners."

Floor leader Yong noted the rollback of tougher tax policies on non-resident-owned properties, warning, "Even the few positive aspects of the tax reform are at risk of being undermined." He criticized, "Rather than failing to strengthen the government's insufficient property holding tax plan, it is instead being weakened further. Without sufficiently strong taxation measures, it will be difficult to stabilize real estate prices through a policy focused exclusively on increasing supply."

Apartment complex in Songpa-gu, Seoul. Photo by Kang Jin-hyung

Assemblywoman Jeong argued, "The government must immediately stop tax cuts that deepen the asset gap among high-value real estate holders and return to a policy stance that seeks to normalize the real estate tax system and align property holding taxes with reality."

Previously, dissatisfaction over the government's tax reform proposal had already surfaced within the ruling bloc, with arguments that it was "insufficient." On August 25, the director of the Democratic Innovation Party Policy Research Institute stated on social media, "The core principle behind the Jongbu Tax legislation pursued by the Roh Moo-hyun administration was fairness. The priority was to realize tax justice itself, not just to increase government revenue." He continued, "However, the comprehensive real estate tax is now moving in the exact opposite direction. Discussions on asset taxation, including the financial investment income tax, are also regressing." The director warned, "The proportion of single-home owners paying the Jongbu Tax will fall below 1%. If the Democratic Party intends to legislate on behalf of that 1%—perhaps motivated by next year's Seoul mayoral election or the general elections in 2028—such a move is likely to backfire, not benefit, the party."

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