President Lee: Real estate investment returns will be lowered, taxes to increase

President Lee Jae-myung declared on April 8 that his administration will fundamentally lower the expected returns from real estate investments. Speaking at a press conference marking his first anniversary in office, Lee asserted that South Korea's current property holding tax burden is too low.

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We must protect homeowners who possess property for residential purposes. If it has become almost a luxury item, it is appropriate to impose holding burdens similar to those in developed Western countries.

"We must protect homeowners who possess property for residential purposes. If it has become almost a luxury item, it is appropriate to impose holding burdens similar to those in developed Western countries," Lee stated. He questioned why investment income is significantly reduced when taxes on earned income approach nearly half.

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Even with profits in the billions, the tax is almost nonexistent.

"Even with profits in the billions, the tax is almost nonexistent," Lee observed, criticizing the past as a "society that encouraged speculation." He added, "Why should we give significant tax breaks for holding property for a long time or for speculative purposes?"

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Why should we give significant tax breaks for holding property for a long time or for speculative purposes?

Lee mentioned that tax-related issues would likely be addressed starting in July, with comprehensive reforms expected to be finalized in conjunction with the budget for the following year. This suggests a phased approach to adjusting the tax structure surrounding real estate.

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This was a society that encouraged speculation.