(EDITORIAL from Korea Herald on Aug. 11)

A Democrat lawmaker from South Korea has suggested converting discarded buses into housing for young individuals, a proposal that has received intense criticism. Young people and netizens alike have harshly condemned the idea, deeming it absurd and an insult to those struggling to find accommodation. Many online commenters have questioned whether young people are truly homeless or refugees, with one asking why the lawmaker would live in such housing themselves before advocating for others.

The government is currently planning to overhaul the real estate tax system later this year, a move that has also drawn substantial backlash. Since the proposal was made available for public comment back in August 4th, over a thousand comments per day have been submitted to the Ministry of Government Legislation's public opinion portal.

The proposed changes would impose heavy taxes on non-resident homeowners, single-home owner-occupiers, and elderly homeowners with just one property and no income. Particularly hard hit would be retirees in Seoul's affluent Gangnam district, who face higher property taxes on expensive homes and substantial capital gains taxes when attempting to sell.

Additionally, the tax overhaul would significantly reduce the capital gains tax deduction for homeowners who have owned their properties for at least ten years and meet residency requirements. The deduction would be capped at 2 billion won (US$1.4 million) in 2028 and 1 billion won from 2029, effectively penalizing those who have lived in their homes for extended periods.

The government has offered a concession, allowing single-homeowners aged 65 or older who sell their residences after living in them for five years and relocate outside the capital to receive a reduced capital gains tax. However, this measure has also faced criticism, with affected individuals questioning the appropriateness of forcing them to move from Seoul simply due to owning a pricey home.

The government's tax policies have also drawn strong criticism for non-resident homeowners, who receive little consideration for the diverse circumstances of their situation. Many non-resident single-homeowners, if not resident homeowners, are ordinary people who have temporarily moved near their parents for their children's well-being. These individuals should not be labeled as speculators merely because their home's value has increased or they don't reside in the property they own.

Moreover, renters are increasingly concerned about potential evictions and escalating rents, as some single-homeowners who do not live in their properties might ask tenants to vacate and take over to avoid the heavy taxes. This widespread resistance to the tax measures suggests the government has taken the wrong approach to tax reform from the start, and the Democratic Party of Korea has indicated it will work with the government. The prospect of returning to the drawing board should not be dismissed.