Inheritance and gift tax revenues increased by 24% year-on-year to KRW 10,375.3 billion… 23% more than expected
▲ The whole area of Gangnam apartment complex as viewed from Namhansanseong, Gwangju, Gyeonggi-do. (Reporter Shin Tae-hyun holjjak@)
Last year, the number of home donations exceeded 150,000. The government’s inheritance and gift tax revenue also surpassed 10 trillion won, the highest in history.
According to the Ministry of Strategy and Finance on the 13th, last year’s inheritance and gift tax amounted to KRW 10,375.3 billion. This is an increase of 2,462 trillion won compared to the previous year, an increase of 24.6%.
This is 1,958.8 billion won (23.3%) more than the estimated tax revenues expected at the time of the 3rd supplementary budget.
Inheritance and gift tax revenue is basically a structure that draws an upward curve. As the value of the target asset increases, the tax revenue naturally increases. However, the rate of increase last year of 24.6% is unusual.
It is analyzed that last year’s surge in the real estate market and the government’s real estate measures to calm it down affected the rapid growth rate.
Last year, the home sales price index rose by 5.4%, which is a factor in increasing tax revenue because the increase in sales prices has the effect of raising the value of the property subject to inheritance and gift.
The number of home donations had a more decisive effect. Last year, the number of home donations was 152,000, a 37.5% increase from a year ago.
Last year, the government’s policy of increasing capital gains tax and comprehensive real estate tax as a measure of real estate measures seems to have moved the hearts of inheritors and donors.
The government will increase the transfer tax heavy tax rate for multi-homed people in the target area from 10 to 20 percent on June 1 to 20 to 30 percent. The transfer tax rate for houses held for less than two years and members’ right to move in and sale for sale is raised to 60-70%, respectively. The tax for multi-homeowners is also raised by 0.6-2.8 percentage points from 0.6-3.2% to 1.2-6.0%.
In particular, there are cases where the gift tax is relatively low, 10-50%, while the holding/transaction tax on multi-homed people is excessive, which is an incentive to choose a gift instead of a sale.