President Lee Jae-myung comments on the fairness between real estate capital gains tax and earned income tax

President Lee Jaemyung raised an issue with the structure of the tax burden at a State Council meeting on the 4th, citing the difference in the burden between earned income tax and real estate capital gains tax. The president said that earned income tax can rise to as much as 49.5% when various surcharges are included, but even when real estate capital gains reach the 10billionwon range, the tax may remain at only a few hundred million won. This is interpreted as meaning that a relatively lower tax burden is applied to profits from disposing of real estate compared with highincome wage earners. However, according to the article, home transactions exceeding 10 billion won are extremely rare even in Seoul. Of the 44,491 apartment transactions in Seoul so far this year, only 18 involved transactions over 10 billion won, accounting for just 0.04% of the total. Experts say earned income and capital gains are difficult to compare simply because the period over which they are generated and the way they are taxed differ. They also pointed out that rising housing prices partly reflect inflationary factors, so these should also be considered when assessing the tax burden.