Parties likely to extend real estate tax reduction
Published : 2013-01-07 20:17
Updated : 2013-01-07 20:33
The real estate acquisition tax reduction looks likely to be extended at the upcoming parliamentary session with the two main political parties agreeing on the need to stimulate the real estate market.
“As it (extension of tax reduction) is something the public has anticipated and hoped for, the floor leader should lead the efforts to draw up a logical solution even if there are difficulties in making the decision due to concerns over provincial fiscal conditions,” Saenuri Party chairman Hwang Woo-yea said at the Supreme Council meeting Monday.
The main opposition Democratic United Party also appears to view the extension positively, with floor spokesman Rep. Yoon Kwan-suk saying that the party planned to “discuss extending the tax reduction to stimulate real estate transactions.”
From Sept. 10 to the end of last year, the real estate acquisition tax was reduced to stimulate the slowing market. As a result, the tax rate on residential properties under 900 million won ($846,000) was halved to 1 percent, while that on properties between 900 million and 1.2 billion won was cut to 2 percent from 4 percent. Properties exceeding 1.2 billion won were taxed at 3 percent.
Although applying the lowered rates for a longer period has been on the parties’ agendas, the issue was set aside due to provincial governments’ concerns over their tax revenues.
The real estate tax reduction, however, could be the only issue the two sides see eye-to-eye on during the extraordinary session of the National Assembly, which is expected to be convened between Jan. 15 and 21.
While the ruling Saenuri Party hopes to focus on processing the plans for government restructuring drawn up by President-elect Park Geun-hye’s transition committee, the DUP has announced that it will concentrate on passing what it has termed the “five public livelihood laws.”
The five include those aimed at protection for small merchants and the agricultural industry, and a number of acts regarding nuclear power.
In addition to the priority clashes, Saenuri Party and the DUP will likely clash over Lee Dong-heub, the Constitutional Court president nominee.
The DUP has called for the retraction of Lee’s nomination claiming that the nomination was a reward for Lee having taken stances favorable to President Lee Myung-bak on a issues.
For its part, the ruling party has stated that the issue needs to follow standard procedures.
The issue of a parliamentary investigation into Ssangyong Motor Co. will also be a major sticking point in the upcoming extraordinary session.
The DUP has been calling for a parliamentary investigation into the developments surrounding the mass layoff in 2009. In 2009, the carmaker went into court receivership and more than 129 workers were laid off. Since then 23 former Ssangyong Motor employees and their families have died due to suicide and other causes.
The issue appeared to be gaining Saenuri Party’s support last year when its chairman Hwang told a local daily that the party plans to accept the request for the parliamentary investigation after the presidential election. Hwang and other Saenuri lawmakers also visited the carmaker on Jan. 3.
On Monday, however, Saenuri Party floor leader Hee Hahn-koo said that he opposed the idea, inciting criticism from the opposition party.
“If I was to decide by myself, I would oppose it. It would be different if a parliamentary hearing could solve the problem of laid off workers, but as it could make Ssangyong’s management even more difficult I am of the opinion that more consideration is needed,” Lee Hahn-koo said on local radio. He added that interference from the outside was complicating the issue, and that a parliamentary investigation would only damage the company’s brand image further.