“Last year’s 10,000 won tax was 1.3 million won”
“Payment of the tax burden will be passed on to the lessee”
“When the child was born, I sold the house I lived in and moved to a bigger house on the outskirts of Seoul. I just moved, but it was a two-family house, and the property tax came out to 5 million won.”
“I have a house worth 500 million won and 600 million won, and the property tax from 10,000 won last year increased to 1.3 million won this year. If it wasn’t for the 300% cap, I would have to pay 2.7 million won.”
While the National Tax Service started sending out this year’s comprehensive real estate tax (special property tax) bills for housing this year on the 22nd, some people who checked the tax amount at Hometax are shocked. On this day, real estate-related online communities were flooded with posts expressing their embarrassment at the sudden increase in the property tax, centered on multi-homeowners.
One netizen complained, “If you change houses, you inevitably become two temporary houses. Is it correct to pay taxes under the pretext of that?” and “Transfer tax provides temporary benefits for two houses. It’s not for speculation, but it’s excessive.” Another netizen said, “This year, the tax on property tax came out to 1.3 million won, but if you add the rural tax, it’s 1.6 million won.”
There are many people who look for loans or installments to pay the estate tax. This is because the cash is short as they have to pay the property tax, which was announced in the middle of this year, and the estate tax, which has risen significantly. A, an office worker in his 50s living in Seoul, said, “I paid the property tax in 6-month installments, but I also had to pay the estate tax.” If the tax amount exceeds 250,000 won, you can apply for tax payment in installments.
A citizen is looking at a tax bill of 18 million won. photo = Yonhap News
At the same time, there are also critical voices against those who are appealing for the tax burden. It is pointed out that home prices have risen and they have made huge profits, but they are shivering with the small amount of taxes. One netizen criticized, “These people who are suffering from taxation are multi-housing speculators who make up only 2% of the country’s population.”
However, these criticisms have not received much sympathy. One netizen complained, “I have to sell to make a profit, but I can’t sell it because of taxes.” “There is no money earned even if house prices go up. Do you know that if house prices drop here, you can even get a tax refund?” Another netizen also said, “The subject of tax is 2%, but considering the family, it is actually 6-8%.”
The government is gradually increasing the realization rate of the announced price to reduce the difference between the actual house price and the published price. The government announced that it would set the official land price to 90% of the market price by 2028, and raised the realization rate to 68.4% this year. Since the property tax is based on the official land price, even if house prices remain flat, next year’s tax burden may increase.
Even homeless people who have to rent someone’s house will not be able to avoid the aftermath of the tax increase. Kang Yeong-hoon, CEO of ‘Real Estate Study in Buongsan’, said, “Since last year, the reverse trend has been increasing instead of jeonse, but there is an analysis that the holding tax has had an effect.” Four times as many stakeholders (families) will bear the burden together, and their tenants will raise the rent and bear the secondary burden.”
Oh Se-seong, reporter at Hankyung.com sesung@hankyung.com
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