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The Era of Disparity: Columnist Criticizes South Korea's Tax and Real Estate Policies
🇰🇷 South Korea /Economy & Trade

The Era of Disparity: Columnist Criticizes South Korea's Tax and Real Estate Policies

From Dong-A Ilbo · () Korean

Translated from Korean, summarized and contextualized by DistantNews.

At a glance

Analysis Sources not specified Context piece
  • A South Korean columnist criticizes the government's real estate and tax policies, highlighting a significant profit made by a former prime minister on a property sale.
  • The article argues that the government failed to curb housing price surges and collect adequate taxes, exacerbating wealth inequality.
  • It also touches on the debate around financial investment income tax (FII) and its potential impact on the stock market.

A South Korean columnist has sharply criticized the nation's real estate and tax policies, arguing they create a "Gilded Age" of wealth and inequality. The piece focuses on a former prime minister who reportedly profited around 3 billion won from selling an apartment held for 20 years, benefiting from a tax break for long-term homeowners.

The tax system in our country gives us more than 2.5 billion won, even after paying taxes.

— Song Pyeng-inDescribing the profit made by the former prime minister on a property sale.

Despite the significant profit, the tax paid was reportedly only around 460 million won. The columnist points out that if the full capital gains tax for multiple homeowners had been applied, the tax liability would have been substantially higher, potentially over 2.25 billion won. This starkly illustrates what the author calls "K-polarization," where some individuals amass vast wealth through property while others struggle.

The article places blame on both the previous Moon Jae-in administration for failing to control housing prices and the current Yoon Suk-yeol government for easing regulations and taxes. It specifically criticizes the Yoon administration's decision to postpone the implementation of a capital gains tax on financial investments, arguing this move was misguided and driven by a "delusion" to channel liquidity into the stock market.

The fault lies with the Moon Jae-in government, which failed to prevent the sharp rise in housing prices, and the Yoon Suk-yeol government, which failed to collect adequate taxes after the price increase.

— Song Pyeng-inAssigning blame for the current economic situation.

Ultimately, the piece calls for a return to the principle that income should be taxed, especially unearned income from assets. The author laments that while labor income is taxed, significant profits from real estate and stock investments, particularly those considered "unearned income," are not adequately contributing to state revenue, widening the gap between the wealthy and the rest of society.

There is a tax on income where there is income, but it only applies to earned income.

— Song Pyeng-inCritiquing the application of tax principles in South Korea.
DistantNews Editorial

Originally published by Dong-A Ilbo in Korean. Translated, summarized, and contextualized by our editorial team with added local perspective. Read our editorial standards.

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