Concerns are emerging within the Democratic Party regarding the tax reform plan announced by the government on August 3. Some lawmakers express disappointment, stating it fails to address housing insecurity for ordinary citizens and prevent stock price suppression.
Nam In-soon, the Vice Speaker of the National Assembly representing Songpa District in Seoul, commented on Facebook on August 4, saying, "The continued rise in housing prices in Seoul has intensified housing insecurity for ordinary citizens, and this reform plan leaves much to be desired."
Nam emphasized that the plan should have clearly communicated a commitment to invest additional tax revenue in enhancing housing welfare for youth and newlyweds, urging the government to quickly develop follow-up measures to actively resolve housing insecurity.
Lee Hoon-ki also expressed significant disappointment with the newly announced tax reform plan, stating, "Rather than preventing stock price suppression, it seems to provide criteria for evading detection."
He explained, "This reform plan suggests that a company must fall into the bottom tier of price-to-book ratios in 12 out of the last 13 half-year periods to be classified as engaging in stock price suppression. This effectively sets a standard for companies not to be classified as such."
Lee further criticized the plan for relying on past average stock prices as a valuation standard, arguing that it fails to eliminate incentives for stock price suppression. He also raised concerns that the determination of tax liability is left to the discretion of the National Tax Service, which could undermine the principles of tax law.
Lee So-young, a member of the National Assembly who has served on the Finance and Economy Committee and the Special Committee on Budget and Accounts, labeled the tax reform plan as "a bad law so flawed that pointing out its issues seems pointless."
She predicted that there would effectively be no applicable targets for the government's proposal, adding that any companies affected would likely file lawsuits against the National Tax Service's review and decision processes. "This would mean investing taxpayer money in expensive litigation with a high likelihood of losing," she assessed.
Lee So-young directed her criticism at the Ministry of Finance, stating, "I do not believe the government was unaware of these issues when drafting the proposal. There must be a reason for creating such an ineffective and poor law. This government proposal makes fools of the National Assembly and betrays the President's sincere directives for work."
* This article has been translated by AI.
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