Tax Breaks on Housing Rentals, Sales

Government cuts taxes on sales and rentals of residential houses to invigorate real estate market

Minister Kwon Do-youp of the Ministry of Land, Transport and Maritime Affairs (MLTM) said on Aug. 18 that the tax on the sale of an apartment worth 500 million won will be reduced by 50 million won.
In a media conference, Minister Kwon said the sellers of apartments worth more than 900 million won would see their sales taxes cut by more than 100 million won in a government measure to invigorate the real estate market.
People who own more than two houses can be registered as a house leasing dealer under a government policy to drastically expand real estate asset management.
A tax consultant at Kookmin Bank said an owner of a residential house can be allowed to deal in real estate and can benefit greatly from non-taxable measures on the sale of residential houses on both new and current house dealers.
The government also cut the tax rates on monthly and long-term rents on residential houses below 50 million won from the previous 30 million won. Housing leasers will have up to 40 percent of their rents tax exempt, or three million won per year, as the upper limit. The principal repayment on loans to pay for rentals will also be tax exempt, along with the interest on those loans.
The MLTM also decided to increase the number of residential houses to be supplied in the Seoul area and four other cities in the country to 20,000 units by expanding the house buying and leasing project being undertaken by the Korea Land and Housing Corp. to include new houses.
The MLTM says that Minister Kwon, Jang Do-wan, president of the Korea Institute of Geoscience and Mineral Resources, and Chung Joon-yang, CEO of POSCO, held a ground-breaking ceremony at the Seawater Lithium Research Center at Okgye Myoen, Gangreung, on July 15.
It is reported that around 200 people including Choi Mun-sun, governor of Gangwon Province, and Choi Myoung-hee, Mayor of Gangreung city, attended the ceremony to celebrate the launch of a research center that aims to commercialize lithium extracted from seawater.
The center comprises of two buildings, one for research and development on technology to commercially produce lithium from seawater and the other one for the development of a manufacturing process to produce lithium carbonate. Also, there is a plant for lithium absorption and desorption, and empirical research.
The MLTM has supported research on recovering lithium from seawater conducted by the Korea Institute of Geoscience and Mineral Resources since 2000 and successfully secured world-class lithium absorption technology in 2009.
The research center will focus on developing a key process for the mass production of commercially viable lithium carbonate by 2012 and carry out research on technology to commercially produce lithium by building plants that extract more than 30 tons of lithium carbonate annually by 2014.
Lithium is used to make batteries for electronic devices such as mobile phones, notebook PCs and camcorders and is considered a strategic resource, as there is only 4.1 million tons that can be commercially produced and it is mostly concentrated in Chile and Bolivia. nw

Minister Kwon Do-youp, left, is on a tour of a public housing project called Nest-house Project in the Kangnam area in Seoul on Aug. 22 accompanied by President Lee Ji-song of the Korea Land and Housing Corp., center, listens to a briefing by an official related to the project.

Photo on Courtesy of MLTM