Lee aide hints at tougher taxes on homeowners amid AI boom

South Korean President Lee Jae Myung's aide Kim Yong-beom hinted at tougher taxes on homeowners to prevent housing market overheating amid an AI-driven economic boom, prompting opposition calls for his dismissal. The ruling party argues the tax adjustments are necessary to prevent real estate speculation and ensure AI windfalls benefit all, while the opposition claims the taxes will hurt the poor.

An aide to President Lee Jae Myung has hinted at imposing more taxes on homeowners to stop the housing market from further overheating. This prompted the right-wing opposition People Power Party's call to hold the presidential aide accountable for causing confusion in the property market, as it claimed the tax hike on the wealthy would wind up hurting the poor. On Saturday, Kim Yong-beom, chief secretary for national policy for the liberal president, wrote via Facebook that it would be plausible to "normalize" taxation on real estate assets. In other words, South Korea needs to "rationally adjust" property taxes and comprehensive real estate holding taxes for those owning at least a house, as well as capital gains taxes for those selling their houses for profit, he noted. With a sudden upshot in consumer purchasing power expected due to chips-related windfalls, Kim said there is a high chance of a select group of people turning to the housing market, repeating decades of history. This ultimately would lead to the economic bipolarization of society, given that windfall from the artificial intelligence boom is not being enjoyed universally and equally, Kim claimed. In addition to these tax changes, Kim called for creativity in how the fruits from once-in-decades economic prosperity are shared and how the AI windfalls are contributing to the support for the underprivileged and the young generation. His remarks came as South Korea is planning to announce tax code revisions in July. In response Sunday, People Power Party's Floor Leader Rep. Jeong Jeom-sig said via Facebook that Cheong Wa Dae should sack Kim for causing confusion in the housing market. " Cheong Wa Dae must dismiss Kim, who is causing public confusion by hinting at tax hikes immediately after the election is over," Jeong said, referring to local elections held June 3. Before the elections, Cheong Wa Dae had long considered any change in taxes imposed on homeowners as a last resort to curbing speculative buying in the housing market, one of the policy priorities in the liberal government. Rep. Park Jee-hye of the ruling Democratic Party of Korea said Sunday the right-wing party was distorting Kim's message to score political points. "Tax adjustments are part of the responsible act of an administration aimed at preventing reckless real estate speculation," Park noted in a statement, adding that the gist of Kim's message was that preemptive measures should be employed so that nobody misses out on the AI windfall. Both parties sought to spin the impact from the tougher taxation on homeowners in their favor. Park said that without a tax hike on homeowners, the housing market could not be normalized and those bearing the cost would be the working class and young people who do not own a house. Cho Yong-sool, a spokesperson for the People Power Party, said Sunday that the working class and young generations would likely be affected by the taxation because homeowners would pass on the burden by spiking rents on these people. consnow@heraldcorp.com