"Real estate transfer tax burden doesn't match fairness with earned income"

President Lee Jae-myung directly stated the rationale behind the real estate tax reform plan that strengthens the tax burden on high-value homes and non-resident primary homeowners. This was interpreted as demonstrating strong will to correct tax equity between asset income and earned income and to block real estate speculation.

▲ "Even earning 10 billion won, taxes are only hundreds of millions"… Asserting justification for tax equity and actual residence-based taxation reform

President Lee Jae-myung raised the issue of tax equity for real estate transfer income tax at a cabinet meeting held at the presidential office on the 4th, citing earned income tax rates reaching a maximum of 49.5%.

The president stated, "If someone buys property for investment and makes tens of billions of won but pays almost no taxes, it doesn't match the fairness with workers' earned income." He strongly criticized the fact that appropriate taxation is not being imposed on unearned income from real estate investment that is not for actual residence purposes.

He further assessed that the current transfer income tax system has deviated from its original purpose of housing protection and resulted in protecting real estate speculation. While acknowledging this is an unpopular tax reform, he emphasized that adjustments to the taxation system are inevitable for normalizing the tax system and sought public understanding.

▲ Dismissing controversy over extension of heavy taxation exemption for multi-property owners… Setting up 'step-by-step exit' to induce listings

President Lee drew a line against suggestions of "policy inconsistency retreat" raised by some regarding the temporary easing of heavy taxation on transfer income tax in adjustment target areas for multi-property owners, stating it is not true.

He clarified that this temporary easing of heavy taxation is not eliminating the heavy tax itself, but rather opening a path for multi-property owners to list properties on the market by temporarily lowering tax rates and then gradually raising them in stages.

During this process, he instructed Vice Prime Minister and Minister of Economy and Finance Koo Yoon-chul to strengthen communication so that the policy intent can be accurately conveyed to the public.

President Lee reiterated that consistent enforcement is above all important to secure credibility in government policy.

He made clear that while the decision-making process must be careful, policies once confirmed must be pursued firmly in order to gain market trust.