[EDITORIALS]Usher real estate bill through

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[EDITORIALS]Usher real estate bill through

Revisions to real estate laws are out of the immediate picture because the National Assembly dragged its feet. Besides the introduction of comprehensive real estate taxes, the revision bill contains items that relate directly to people’s lives, such as adjustments on registration taxes and property tax rates. These important issues involving people’s lives have been pushed back amid the neglect of political circles without having a chance to be presented at the plenary session of the Assembly.
The shock and confusion that will derive from postponing the revision of real estate taxes will be immense. Some people have been delaying registration, due to the government’s announcement that it will immediately lower registration taxes. Those people will have to pay the current 3 percent tax rate instead of 2 percent. The Ministry of Government Administration and Home Affairs reportedly receive an average of 100 inquiries on a daily basis from people who have just bought homes or those who are waiting to move into their new apartments. It is questionable whether these people will quietly accept the circumstances when they are told to pay more taxes.
Moreover, if the revision bill dies, the public value of land will rise without any tax rate adjustment. In this case, real estate holders will have to pay somewhere between 30 to 40 percent, up to 60 to 70 percent more taxes next year.
This will probably create another wave of opposition. On top of that, indecision on whether or not extra transfer taxes for households that own three houses will be deferred as well. Confusion is bound to add up.
Currently, the domestic real estate market has a dearth of transactions. Those who want to sell their property to avoid the burden of holding taxes face transfer taxes, acquisition taxes, and registration taxes. Thanks to these circumstances, the market is frigid― not only the Gangnam region in southern Seoul, but all across the country. It applies to both existing housing as well as sales of housing units that will be built. In addition, if policy legislation is postponed because of political skirmishes, it will only amplify distrust and uncertainty.
The ruling and opposition parties, along with government, should refrain from adding to the people’s confusion and pass the real estate tax revision bill during the temporary session of the National Assembly.
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