Seoul: The Cabinet has approved a revision to the enforcement decree of the Income Tax Act, which will end a temporary exemption from heavy capital gains taxes for owners of multiple homes. This decision will see a maximum tax rate of up to 75 percent applied to capital gains from the sale of homes owned by multiple-property holders in designated speculative areas, particularly in the wider capital region, starting on May 9.
According to Yonhap News Agency, the heavy taxation had been temporarily postponed under the previous administration of President Yoon Suk Yeol and will now resume after nearly four years. President Lee Jae Myung has highlighted the importance of stabilizing rising housing prices and curbing real estate speculation, especially in the greater Seoul area.
The government plans to offer a grace period of four to six months in specific cases where tenants currently occupy properties. For properties in Seoul's upscale Gangnam and Yongsan districts, a four-month grace period will be provided, while newly designated speculative zones in other Seoul districts and surrounding Gyeonggi Province will have up to six months.
The grace period will be applicable in situations where final payments are completed or ownership registration is finalized within the designated timeframe. Finance Minister Koo Yun-cheol mentioned on social media platform X that supplementary measures were suggested to reduce public inconvenience, including clarifying the timing of sales contracts and final payments according to tax law. The revision is scheduled to be promulgated on February 27, as stated by Koo.