Jo Jung-dong,’Shock”Bomb’ to Rising Public Land Price
On the 15th, the Ministry of Land, Infrastructure and Transport unveiled a publicly announced price plan for apartment houses (a house designed to allow multiple households to live in a single building by 19.08% compared to last year). The rate of increase was 4.44% in 2017, 5.02% in 2018, 5.23% in 2019, and 5.98% in 2020.
The reason for the increase in the official price is the surge in apartment prices since last year. In the country, Sejong rose the most with 70.6%, Daejeon 20.5%, Seoul 19.9%, Busan 19.6%, and Ulsan 18.6%. When the published price rises, the housing ownership tax, such as the property tax and the housing ownership tax such as the comprehensive real estate tax, increases. In addition, health insurance premiums for local subscribers will also increase.
Conservative media criticized the government as blaming the increase in public announcements by using words such as “shock” and “bomb”. It also claimed that the public land price rose and the people were struck by a tax bomb. On the other hand, the median and progressive newspaper argued that it is natural for the publicly announced land price to rise when the house price rises, and that policies should be supplemented so that there are no victims of good faith.
The Chosun Ilbo, the JoongAng Ilbo, and the Dong-A Ilbo used the word’shock’ in the title at the same time, conveying the news of the increase in official prices on the front page. “Disclosure price… Sejong 70%, Seoul Nowon 34% soaring” (Chosun Ilbo) “Public disclosure price shock, Mapo 1 house ownership tax jumped 52%” (Joongang Daily) “’Public disclosure price shock”… 210,000 household tax increases” (Dong-A Ilbo)
In an article on the front page of the Dong-A Ilbo, it was pointed out that the government, which failed to catch a surge in house prices due to the failure of real estate measures, is only increasing the tax burden on the basis of fair taxation. In addition, in accordance with the roadmap for realizing the public announcement announced by the government in October last year, work to bring the public announcement price closer to the market price will begin in earnest from this year. The government is planning to increase the actualization rate of public announcements from 69% last year to 70.2% this year, and then raise it by an average of 3 percentage points per year to reach an average of 90% by 2030,” the government reported.
The Dong-A Ilbo borrowed the words of a professor who expressed negative intentions about the increase in publicly announced land prices. After the Dong-A Ilbo interpreted, “Experts believe that a plan to increase public prices could be announced in a situation where trust in the public has declined due to the alleged speculation of land by employees of Korea Land and Housing Corporation (LH), resulting in intensifying backlash among landlords and retirees” I quoted a comment from a university professor.
“There have been many questions about the transparency of the disclosure price calculation, but no specific improvement plan has come out. If this is the case, distrust in the general tax policy as well as real estate policy can grow” (Jeong Soo-yeon, professor of economics at Jeju National University)
The Chosun Ilbo was concerned about the taxation of multi-homed people in a three-page article. The Chosun Ilbo said, “Multi-homeowners are faced with a possession tax bomb that cannot be covered by a considerable amount of salary for an office worker. For example, two houses, which have 76㎡ for Eunma Apartment in Gangnam-gu and 84㎡ for’Silrim Prugio 1st in Gwanak-gu,’ have a holding tax of 39.91 million won this year, which is more than 23 million won from last year (16.27 million won),” he reported.
Jo Jung-dong made a voice in an editorial, saying, “The people have a bent back.” The Chosun Ilbo said, “If the official price of 900 million won, which is subject to the taxation tax, is exceeded, the increase rate of the holding tax reaches 40% in one year. What sin did the person living with a house commit? Health insurance premiums linked to the published price also rise accordingly. Health insurance premiums for 1.27 million self-employed households will increase from November, and 20,000 retirees or elderly people who do not have cash income will be charged a new health insurance fee of about 120,000 won per month.”
The Chosun Ilbo said, “It is like a force to sell a house. It is said that a person with two houses can exceed 100 million won in ownership tax alone. Even if you try to sell a house, the transfer tax is so high that it is difficult to sell it and go to another place. It is making the people do not do this or that.”
The JoongAng Ilbo insisted in an editorial that “the Moon Jae-in government’s real estate policy failure has greatly increased household debt and amidst’thunderbolts’, this time the public price shock hit our society.” The people must bear the damage intact,” he wrote.
In an editorial by the Dong-A Ilbo, “The rising property tax burden is exceeding the level that retirees with only one house and no other income can afford. Last month in the National Assembly, opposition lawmakers proposed a bill to reduce the tax burden for one household and one homeowner, but the government could not even deliberate against it. “The real estate tax that only Aman citizens, not the house price, needs to hurry to take care of it,” he argued.
Jungdo-Jinbo Newspaper “It is natural to raise taxes due to soaring house prices”
On the other hand, the median and progressive newspaper argued that it is natural that the publicly announced land price rises when the house price surges. He also said that the policy should be supplemented so that there are no victims of good faith.
In an editorial, the Hankyoreh said, “When the public price rises, the burden of ownership tax, such as property tax and comprehensive real estate tax, increases, and some high-priced and multi-household owners may feel a great burden. However, as there has been high public consensus that the publicly announced prices are too low to be effective than the market prices, it is a natural process toward’normalizing public prices’. In terms of raising tax equity and blocking speculative demand, positive effects are also expected.”
The Hankyoreh said, “It is a very different argument from the fact that some people raise the’tax bomb theory’ again. Last year, due to the revision of the tax law to reduce the burden of’one middle and low priced houses’, the burden of property tax for houses with an official price of less than 600 million won this year will be considerably lowered. This is 92.1% of the nation’s apartment houses and 70.6% of Seoul. In addition, the introduction of a property tax cap limits the rate of increase in tax burden to 5% for the public price of 300 million won or less and 10% for 600 million won or less. Only 3.7% of the total, or 525,000 houses, exceeded the official price of 900 million won, which increases the tax burden. Most one-homeowners have reduced or negligible ownership tax burden.”
In an editorial, the Kookmin Ilbo, “When the price of a house rises, it is natural that the ownership tax also rises. Bridging the gap between the quoted price and the market price is a desirable direction for improving tax equity,” he said. “However, the recent surge in house prices is largely caused by the failure of the government’s real estate policy. Homeowners’ complaints are bound to erupt. As the realization of public prices and strengthening of the holding tax are effective means of stabilizing the real estate market, the policy stance should be maintained, but it is necessary to adjust the gradual rate in consideration of the impact on households.”
In an editorial by the Hankook Ilbo, “It is difficult to say that the policy direction is wrong as there have been many points about the quoted price, which is extremely low compared to the market price.” Bigger. Moreover, if LH employees’ allegations of speculation and policy credibility are low, if they try to raise taxes more, then the anger against the government can only increase. There are also criticisms that they can’t catch house prices and speculators and only the people.”
The Hankook Ilbo said, “The government raised the official price to increase the burden of ownership tax in order to stabilize the market by inducing the sales of multi-homeowners to sell off. However, multi-homed people complain that they cannot sell even if they want to sell it under the punitive capital gains tax. As the holding tax has risen due to an increase in the public price, it is easy to think about how to open up a transaction in the market by lowering the transaction tax. A meticulous approach is also required,” he advised.
The Hankyoreh checks the controversy facts of President Moon’s sister-in-law
The fifth page of the Chosun Ilbo on the 15th published an article comparing the sister-in-law of President Moon Jae-in with former President Lee Myung-bak. The Chosun Ilbo said in an article titled “Sister Moon 796 pyeong, 2.5 times MB… Gyeongho-dong construction cost is twice that of Park”. It is not small compared to the former president’s sister,” he insisted.
The Chosun Ilbo said, “The area of the site for President Moon’s sister’s residence is 2.5 times larger than that of the former president’s sister’s residence. It was reported that the budget for the construction of security facilities was that President Moon spent 3.89 billion won, which is more than 2.189 billion won, more than the former president’s sister Park,” he reported.
The Chosun Ilbo compared the area of the sister’s residence and the budget, but did not comment on the regional differences between Seoul and Yangsan, Gyeongnam.
In an article on page 6, the Hankyoreh said, “The conservative press compares the size of President Moon’s sister-in-law with that of former President Lee Myung-bak and Park Geun-hye’s, and issues the appropriateness of the scale. In fact, it is true that the site of the former president’s sister-in-law in Nonhyeon-dong, Gangnam-gu, Seoul (1023㎡) or the site of former president Park’s sister-in-law in Naegok-dong, Seocho-gu, Seoul (406㎡) is wider. However, he argued that it is difficult to simply compare the size of rural land including farmland and Seoul land regardless of the land price.”
The Hankyoreh also wrote an editorial. The Hankyoreh said, “Comparing to former President Lee Myung-bak Park Geun-hye’s sister-in-law in Gangnam, Seoul, the larger site is also used as the subject of the attack. Comparing Gangnam and Yangsan is in itself unreasonable. It reminds me of former President Roh Moo-hyun’s criticism of his sister-in-law, who established in Bonghama-eul in 2007, as’Abang Palace’.”
The Hankyoreh said, “The essence of the LH incident is that public officials used development information to speculate on the ground. It’s not a matter of hooking up with the president who will retire and farm. The power of the people and the conservative media will not know what to do. I hope that the excessive political offensive to somehow embarrass the President will stop at this point,” he advised.
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