Han Byung-do: Revised Tax Plan Reflects Listening to the Public and Markets

Democratic Party floor leader Han Byung-do says the government’s revised tax plan is not a retreat, but the result of listening to public and market opinion. Speaking at a National Assembly policy meeting, he described the changes as a reasonable outcome reached by the ruling party and government.

The government had pursued tougher taxation for single-home owners who do not live in their properties, citing efforts to curb gap investment. After opposition from the public and the ruling party, it partly reversed course. The government will keep its plan to raise the basic comprehensive real estate tax deduction for owner-occupiers from 12 billion won to 14 billion won, but will retain the existing 12 billion won deduction for non-resident single-home owners.

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The revised tax reform plan is a reasonable result reached by the ruling party and government after listening carefully to the opinions of the public and the market.

Officials also withdrew a plan to raise the comprehensive real estate tax ceiling for non-resident single-home owners from 150% to 200%. Changes proposed for individual savings accounts were also rolled back. The government abandoned plans to remove contract-period limits and eliminate the ability to carry over unused contribution allowances. It will instead allow overlapping subscriptions to youth individual savings accounts and youth future savings accounts. The revisions effectively restore much of the tax reform plan released on Aug. 3.

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I want to ask the People Power Party whether reflecting the public’s voice in policy is really inconsistency or surrender.

Han rejected opposition criticism that the government had made a “U-turn after 29 days.” He said listening to citizens and reflecting their views in policy should not be described as inconsistency or surrender. He added that the Democratic Party would use lawmakers’ proposed legislation to prepare measures against stock-price suppression during the regular parliamentary session.

On Chuseok price controls, Han said the government would judge the holiday measures by receipts rather than indicators. Officials plan to increase supplies of seasonal goods and support discounts on agricultural, livestock and fishery products. Han said they would watch whether price stability reached traditional markets and neighborhood businesses. He also dismissed opposition claims of a lame duck government, saying such claims would not create a lame duck situation where none existed.

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The success of the holiday measures will be decided by receipts, not indicators, and we will make every effort to manage prices.