Kwon Chil-seung, policy committee chairman of the ruling Democratic Party, said it would be more reasonable to impose a capital gains tax penalty on people who own a single home but do not live in it, rather than factoring residence into the comprehensive real estate holding tax. His view is that raising the tax burden on non-resident single-home owners through the capital gains tax is preferable to reflecting whether an owner actually lives in the property when assessing the holding tax.
Speaking on a KBS radio program on the 26th, Kwon made the remarks in connection with a planned overhaul of the holding tax for single-home owners who do not live in their properties. "It is true that the government and the party currently have somewhat different views and are working to reconcile them," he said. "The comprehensive real estate holding tax is fundamentally a tax on property ownership," he explained, adding that "the basic principle of a holding tax is to levy it based on the value of a home, how many are owned, and for how long."
"Various theories are being raised over the variable of whether an owner has actually lived in the property, but I think it is right to recognize that the holding tax is fundamentally a tax on ownership," he said. "On the issue of owning a home without living in it, I personally think it would be a more reasonable tax policy to impose a penalty through taxation on capital gains."
Kwon also acknowledged that it is difficult to hold to a purely principled position amid the disagreement between the party and the government. "Given the various conditions in the current property market, the government's position is that residence requirements should also be considered for the holding tax," he said. "Within the party, there are views, still being reconciled, that the holding tax should be designed according to the inherent logic of a tax on ownership."
On the disagreement between the government and the Seoul city government over supplying housing through Yongsan Park, Kwon said both sides should actively discuss alternatives. Regarding the Tancheon Water Reclamation Center, which the city proposed as an alternative site, he said, "If it is designated as a supply site, we need to properly examine how long it would take."
On the controversy over developing Yongsan Park, he said, "Many people seem to have the impression that the entire Yongsan Park would be turned into housing land." He clarified that "the proposal is to use only very limited, selective portions on the outer edges that cannot properly serve as green space when viewed as a whole."
"It is regrettable that it seems the Seoul city government starts out by simply rejecting the proposals the government puts forward," he said. He expressed hope that "if the two of them"—Land, Infrastructure and Transport Minister Kim Yoon-duk and Seoul Mayor Oh Se-hoon—"meet and talk frankly, there could be a good outcome."
