Koo vows relief for homeowners with unavoidable reasons for not living in their properties

Deputy Prime Minister and Minister of Economy and Finance Koo Yun-cheol has reiterated his intention to provide relief for single-home owners who do not reside in their properties for unavoidable reasons, beyond the exceptions already written into the government's real estate tax reform proposal.

Koo made the remarks Thursday at a plenary session of the National Assembly's Finance and Economy Committee, responding to a question from Democratic Party of Korea lawmaker Yun Hu-deok, who asked whether the ministry had received significant public feedback on the real estate tax reform plan. "There were a great many requests to expand the recognized reasons for non-residency," Koo said.

Deputy Prime Minister and Minister of Economy and Finance Koo Yun-cheol answers questions on the fiscal year 2025 settlement report at a plenary session of the National Assembly's Finance and Economy Planning Committee on Thursday. [Yonhap]

"Reasonable grounds for non-residency — such as schooling or studying abroad — will continue to be recognized as before," Koo said. "However, if a case falls under circumstances where non-residency is truly unavoidable during the implementation process, we will ensure that citizens are not inconvenienced."

Under the government's 2026 tax reform package, the tax burden on single-home owners who do not live in their properties will be tightened. The plan includes exceptions, however, under which periods of non-residency may still count as residency periods when calculating capital gains tax and the comprehensive real estate holding tax.

The recognized exceptions cover six situations: enrollment in high school or university; job changes or transfers; illness requiring treatment or recuperation for at least one year; school transfers due to school violence; overseas stays for schooling or work; and living with and caring for a direct lineal ascendant aged 60 or older.

The government has also set conditions to prevent abuse of the system. The exceptions apply only when a homeowner has lived in their own home for at least one year before relocating to a different city or county for unavoidable reasons. The period of non-residency that may be counted as residency is capped at a maximum of three years.

During the public comment period, the ministry received numerous requests to broaden the list of qualifying exceptions. Calls came in repeatedly to recognize a wider range of situations, including caring for grandchildren and unavoidable moves within the same city or county.

The public comment period for the 11 tax law amendment bills prepared by the Ministry of Economy and Finance closes Thursday. The government plans to review the submitted feedback, submit the amendments to the Cabinet on Sept. 1 and present them to the National Assembly on Sept. 3.

y2k@heraldcorp.com