South Korea's 2026 Real Estate Tax Reform Sparks Political and Economic Debate

Lawmaker Park Su‑min of the People Power Party denounced the government’s 2026 real‑estate tax reform as a “worst tax terror,” warning that higher comprehensive property taxes and stricter capital‑gain rules will shift the burden to renters and could erase the real‑income of about 6 million tenants. She argued that the measures would curb housing supply and hurt young home‑buyers.

The Nara‑salim Research Institute estimated that the reform will generate roughly 13.3 trillion won in additional tax revenue over five years, with the comprehensive property tax accounting for about 70 % of the increase. The institute also noted that new exemptions and deductions introduced alongside the reform make the tax system more complex and undermine consistent tax principles, despite the positive fiscal impact.

Critics say the changes will raise the tax rate on homes valued between 600 million and 1.2 billion won from 1.0 % to 1.3 %, and that the government’s focus on tax revenue may exacerbate housing affordability problems for the 20‑40‑year‑old demographic most affected by rising rents.