▪ The average officially assessed housing prices (OAHPs) rose by 14.9% across the nation in 2022.
▪ The 2022 increase in OAHPs is mainly due to a hike in the market value of houses in 2021. The government’s policy to raise state-evaluated prices by up to 90% of their market price also played a role.
▪ The comprehensive real estate holding (CREH) tax and property tax are expected to increase as their taxable values—OAHPs—increase.
▪ As real estate tax revenue is expected to increase due to the hike in OAHPs in 2022 following the increase in 2021, various measures have been proposed by the National Assembly to ease the tax burden.
▪ The government also announced a plan to ease single homeowners’ real estate tax burdens (24 March 2022).
▪ NABO estimates that the government’s tax relief plan for single homeowners may decrease the tax revenue by 0.98 trillion won.
▪ The tax relief plan for single homeowners is expected to be discussed in the National Assembly in the future.
▪ Some people believe it is necessary to ease the real estate tax growth that exceeds taxpayers’ expectations due to the increase in OAHPs but others worry the policy being makeshift and inconsistent.
▪ Therefore, to promote the legal stability and predictability of taxation, it is necessary to comprehensively consider the adjustment measures for the upper limits of the tax burden and fair market value ratio, along with the application of OAHPs of 2021.