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Korean landlords face larger tax |
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Some 60,000 rich landlords are expected to face increased real estate tax burden next year with the enforcement of the new comprehensive real estate tax system, reports Korea Times.
This is due in part to a simplified property tax system with added weight to land and a new tax on vacant land.
The government decided to streamline both the current 9-grade comprehensive land tax rate system and the 6-grade property tax rate system into 3-grade rate systems. The present six-grade property tax rate system will be simplified into three grades of 0.15 percent, 0.3 percent and 0.5 percent. Under the value assessment method of Korea's National Tax Service, which generally underestimates the value of real estates compared to the actual market value, houses with values less than 80 million won will be subject to 0.15 percent property tax rate, those worth more than 80 million won and less than 200 million won to 0.3 percent and those worth more than 200 million won 0.5 percent.
Moreover, tax rates up to 4 percent are introduced on individuals who possess plots of vacant land, on which no architectures exist, with aggregate market value assessed at more than 800 million won ($727,000), and up to 1.6 percent tax rate on people who own tract of lands worth more than 5 billion won ($4.54 million) for business purposes.
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