Politics · South Korea · 1 hr ago
South Korea’s proposed property tax changes draw warnings over home sales
South Korea’s government has proposed changes to property taxes as part of its 2026 tax plan.
At a parliamentary hearing on Tuesday, experts disagreed over higher taxes on homes people do not live in and a shift toward taxing home value and residence status.
The National Assembly Budget Office estimates the property tax changes could raise 12.6 trillion won over five years, more than the government’s estimate.
Some owner-occupiers of lower-value homes could pay less, while many other owners, including people with multiple homes, are expected to face higher bills.
The Budget Office warned higher capital gains taxes could discourage owners from selling, even as higher annual property taxes are meant to encourage sales.
If owners hold on to homes or transfer them instead, the plan may not achieve its housing-market aims; experts said the effects should be monitored as the changes are introduced.
Experts disagreed at a South Korean parliamentary hearing over proposed property tax changes that give greater weight to a home’s value and whether its owner lives there.
Critics warned that higher taxes on non-resident owners could be unfair, push up rents and lead older homeowners to sell.
Other experts said the shift towards home value and actual residence better reflects taxpayers’ ability to pay.
A National Assembly research office warned that higher capital gains taxes could discourage sales, prompting some owners to keep or transfer homes instead.
The research office estimated the proposed changes would raise property holding tax revenue by 12.6 trillion won over five years, more than the government’s estimate.
- Who
- South Korean lawmakers and experts discussing the government’s proposed property tax changes.
- What
- The proposals would change property taxes based on home value and residence, while also changing capital gains tax rules.
- When
- The proposal was discussed at a parliamentary hearing on November 3, 2026.
- Where
- The National Assembly in South Korea.
- Why
- The government aims to adjust property taxation and support housing market stability, but experts disagreed about fairness and possible effects on rents and home sales.
Critics of the proposed changes
Supporters of the proposed changes
Fairness
Critics of the proposed changes
Kim Woo-cheol said stronger taxation of non-resident owners was difficult to justify and amounted to punitive taxation.
Supporters of the proposed changes
Kang Seong-hoon and Oh Jong-hyeon said emphasizing home value and actual residence better reflects taxpayers’ ability to pay.
Housing effects
Critics of the proposed changes
Kim In-man warned that higher holding taxes could be passed on through rents and could prompt older owners to sell; he called for lower acquisition and capital gains taxes.
Supporters of the proposed changes
Supporters said the direction of reform was appropriate, while calling for monitoring of rents and transaction volumes and adjustments if needed.
The National Assembly’s Finance and Economy Committee held a hearing on the government’s tax reform plan, where experts debated the property tax changes.
The National Assembly Budget Office published an analysis projecting that the changes would raise comprehensive real estate tax revenue by 12.6 trillion won from 2027 to 2031.
- Hearing
- National Assembly Finance and Economy Committee, November 3, 2026
- Projected tax revenue
- 12.6 trillion won over 2027–2031, according to the National Assembly Budget Office
- Government estimate
- 11 trillion won over five years
- Expected difference
- Budget Office estimate is about 1.6 trillion won higher than the government’s estimate
- Main tax concern
- Critics warned that higher holding taxes could be passed on to renters and deter home sales
4 sources
What people are saying
The government called it a fair taxation reform, but it is very difficult to justify under any standard.
If holding taxes rise, acquisition and capital gains taxes should be lowered so that more homes come onto the market and help stabilize the housing market.
The direction of emphasizing home value and actual residence rather than the number of homes better reflects taxpayers’ ability to pay.
Strengthening the comprehensive real estate tax is expected to raise the cost of holding homes and encourage sales, but the shift to a long-term residence deduction and the introduction of a deduction cap for capital gains tax increase the tax burden on disposal, so they may lead people to continue holding homes or choose inheritance and gifts.