Rep. Oh Ki-hyung of the Democratic Party of Korea, the ruling party's chief negotiator on the National Assembly's Finance, Economy and Planning Committee, said the basic deduction cap for single-home owners under the comprehensive real estate holding tax should apply equally regardless of whether the owner lives in the property.
The government plan would raise the deduction cap to 1.4 billion won for owner-occupiers of a single home while lowering it to 900 million won for those who do not live in the home they own. Oh argues the cap should be unified at either 1.2 billion won or 1.4 billion won.
Oh made the remarks on the 25th on KBS radio program "Jeongyeok Sisa," outlining how the government's tax code revision should be adjusted.
On the basic deduction cap for single-home owners, Oh said there is "no need to distinguish between owner-occupiers and non-occupiers, as the government plan does," adding that "for a single home, the cap should be applied as uniformly as possible regardless of residency." At a high-level party-government meeting on the 23rd, the Democratic Party had also called for a unified cap irrespective of residency.
Oh proposed 1.2 billion won and 1.4 billion won as options. The 1.2 billion won figure was the basic cap for single-home owners before the tax revision plan was announced, while 1.4 billion won is the cap specified in the plan for owner-occupiers of a single home. "There could be options such as whether to unify it at 1.2 billion won or to unify it at the higher level of 1.4 billion won," Oh said.
Oh also made clear his opposition to raising the ceiling on year-on-year increases in the holding tax burden. The government plan would lift that ceiling to 200% from 150% of the previous year's level. "Isn't there a need to show more restraint when it comes to abrupt changes, in terms of predictability?" Oh said. "Let's keep it as it was."
He also expressed a negative view on raising the fair market value ratio used to calculate the tax base. "If the fair market value ratio is raised on top of rising official assessed prices, the burden on taxpayers could grow excessively," Oh said.
