By Lee Hyo-sik
Staff Reporter
The number of individuals and businesses subject to the comprehensive real estate tax rose 38 percent to 486,000 this year from a year earlier on steep gains in home prices last year.
According to the National Tax Service (NTS) Thursday, the comprehensive tax was estimated to reach 2.86 trillion won this year, up 65 percent from 2006.
The tax, first levied in 2005, applies a higher progressive tax rate on owners of homes worth more than 600 million won under the government-assessed price standard to curb demand for luxurious apartments, especially in southern Seoul, and stabilize rises in property prices. Those holding land worth more than 300 million are also subject to the tax.
The amount levied on high-priced homeowners increased 181 percent to 1.29 trillion won over the one-year period, while the tax on landowners came to 1.57 trillion won, up 23.7 percent.
Six out of 10 individuals subject to the property tax own more than one house, while more than nine out of 10 taxpayers live in Seoul and its surrounding areas.
The tax agency since Thursday has been notifying taxpayers subject to this year's comprehensive real estate tax, saying that they are required to pay taxes between Dec. 1 and 15. If tax payments are made within the given time frame, 3 percent of the total will be deducted from the settled payment. But those who refuse to pay taxes will face a 3 percent additional punitive tax, with the rate rising every month by 1.2 percent.
The number of individuals with high-priced houses and land jumped 40 percent to 471,000 from last year, while businesses subject to the tax totaled 15,000, up 7.1 percent. Individuals and businesses owning expensive homes worth over 600 million won increased 60 percent to 383,000 from last year.
``Prices of homes and land shot up last year, which pushed up the number of individuals and companies subject to the comprehensive tax. The property tax is levied based on the government-assessed standard price on Jan. 1,'' a NTS official said. He also said the government has raised its standard property price to make it equal close to 80 percent of the market value, up from the previous 70 percent, which increased taxes.
About 232,000 individuals, or 61.3 percent of the total subject to the tax, are multiple homeowners, while the remaining 38.7 percent own one house.
By region, about 94 percent of individual homeowners subject to the tax live in Seoul, Incheon and Gyeonggi Province this year, up 1 percentage point from 2006. About 45 percent reside in southern Seoul ― Gangnam, Seocho, Songpa districts ― and Seongnam, south of Seoul, down 7 percentage points.