Democratic Party proposes revising real estate tax for single-home owners

The Democratic Party of Korea is pushing to revise the government's real estate tax reform, focusing on the comprehensive real estate holding tax (종부세) for single-home owners. The party proposed a unified basic deduction of 1.4 billion won for all single-home owners, irrespective of whether they reside in the property. They also called for a reconsideration of abolishing the long-term holding special deduction (장특공제).

This initiative follows a period of declining approval ratings for President Lee Jae-myung and the party, attributed partly to public backlash against real estate policies. The party's new leadership appears to be using this momentum to adjust the tax system, particularly targeting non-resident single-home owners by proposing changes to both their holding and capital gains taxes.

Specifically, the party's leader, Kim Min-seok, stated that the government's proposed tax reform, which includes lowering the basic deduction for non-resident single-home owners from 1.2 billion to 900 million won while increasing the tax burden cap to 200%, requires "deep deliberation." The Democratic Party has reportedly agreed internally to apply the 1.4 billion won basic deduction equally to all single-home owners.

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The tax reform that adjusts the comprehensive real estate holding tax basic deduction for non-resident single-home owners from 1.2 billion won to 900 million won and increases the comprehensive real estate holding tax burden limit to 200% requires deep deliberation.