Lee Proposes Tax Relief to Ease Family Burdens

President Lee Jae-myung on Sept. 11 proposed easing inheritance taxes, saying, “Let us eliminate taxes on inheritances up to 1.8 billion won,” and adding, “By raising the basic deduction and the spousal deduction, we will allow families to remain in their homes without being forced to move because of taxes.” He said he would amend the inheritance tax law to raise the deduction limit from 1 billion won to 1.8 billion won.

Marking his 100th day in office, Lee held a press conference at the Blue House State Guesthouse, where he spoke for 150 minutes and answered 22 questions, outlining his views on inheritance and gift taxes, follow-up measures to prosecutorial reform and real estate policy.

“I cannot agree with lowering the overall inheritance tax rate,” but added, “I believe it is too cruel to force families to sell and leave their homes after a death simply because they cannot pay the tax,” Lee said. “As long as it does not exceed the average price of a single home in Seoul, families should be able to keep living there. Let us settle the matter by passing the amendment this time.” Under the plan, the basic deduction would rise from 500 million won to 800 million won, and the spousal deduction would increase from 500 million won to 1 billion won.

On the threshold that determines major shareholders' liability for capital gains tax on stock sales, Lee said he would withdraw the government proposal to lower the cutoff from 5 billion won to 1 billion won per holding. "I do not think we must insist on lowering the threshold from 5 billion to 1 billion won," he said. "If such a change would hamper market activity, there is no need to press ahead."

Regarding Democratic Party leader Jung Cheong-rae's push for one of the party's three major reforms, "media reform," Lee said, "I would prefer not to single out the press," and noted, "These days, people on YouTube as well as in traditional media attract attention and profit by spreading false information." He added, "From a lawyer's perspective, even serious negligence should not warrant punitive damages if it was not intentional." With that, he put the brakes on the party's proposed amendment to the Press Arbitration Act, which would require publishers to pay several times the damages for not only intentional false reporting but also errors caused by gross negligence, while exempting YouTube.

On follow-up legislation for prosecutorial reform, Lee said the government should take the lead. "Separating investigation and prosecution and transferring the Serious Crimes Investigation Agency to the Ministry of the Interior and Safety are political decisions," he said. "Going forward, the government must prepare measures through careful, dispassionate review and debate so that investigations do not become inadequate."


Hoon-Sang Park tigermask@donga.com