[EDITORIALS]An unfair tax systemVehement opposition has erupted over a surge in the national health insurance fee for self-employed and elderly citizens who live on their own, which started this month. Property taxes also jumped due to real estate measures aimed at decreasing housing prices in affluent southern Seoul. Increased health insurance fees now put more burden on people. Taxes are paid once a year but health insurance is paid monthly so a rise in the latter is a more severe measure.
The areas where health insurance rates increased more than most are: Bundang, Gwacheon, Yongin, Gangnam, Seocho and Songpa in Seoul and new cities in the Seoul metropolitan area such as Guri, Gimpo and Ilsan. House prices in these areas have surged due to the failed real estate measures of this administration.
People’s complaints are pouring in at branches of the National Health Insurance Corporation. They complain the government increased housing prices and now asks for more in insurance fees.
For 37,000 families, the monthly fee has increased more than 50,000 won, or $52. For some, the fee more than doubled. For employed people, the fee is estimated based on the monthly wage. But, as it is hard to calculate the income of the self-employed, the fee is estimated based not only on income but also on assets. The property tax base is used when calculating health insurance fees for the self-employed. Until recently, property tax was imposed separately on buildings and their sites. Last year, the tax was imposed on both together. The real estate price estimated by the government also changed and the tax base has accordingly jumped to 59 percent. As a result, health fees increased.
It would have been acceptable if people had to pay more in insurance fees because their income had increased. But who can accept this change when their business is not doing well and they are making less money, but have to pay a lot more for insurance because the property tax was altered?
If insurance fees skyrocket, people will lose their trust in the system. In addition, the government plans to increase the property tax base by 5 percent each year beginning in 2008 to make the price estimated by the government meet real prices. Health insurance will then keep increasing.
The government placed a limit on property tax on houses worth less than 600 million won so as not to increase more than 10 percent from last year. Likewise, it should set a limit on the rise in health insurance fees, which is the result of changes in the tax base.