Anchor: After locking horns over which homeowners will benefit from eased property taxes, the government and the ruling Democratic Party(DP) apparently agreed to boost the beneficiaries of lowered property taxes from people owning homes costing up to 300 million won to those costing up to 600 million won. It remains to be seen how this decision will affect the government's push to increase the official appraisal prices of residential homes.
Choi You Sun reports.

Report: The South Korean government and the ruling Democratic Party(DP) have reportedly agreed to lower property taxes for people who own only one home that is worth less than the government-appraised value of 600 million won.

According to a ruling party representative, the two sides reached an agreement after President Moon Jae-in reportedly insisted on a 600-million-won cap in order to ensure fairness in taxation. The DP had proposed a 900-million-won cap.

This comes as the government seeks to raise the official appraisal price of residential property, which is usually lower than the market value.

This has led to criticism that owners of expensive homes are not being taxed accurately.

In a bid to prevent a sharp tax increase for owners of one low-to-mid-priced home, the government and the DP had earlier agreed to lower taxes for people falling under the 60 million to 300 million won tax bracket, and to expand
other brackets of taxable home owners.

All eyes are now on how the changes will affect the government's move to raise official home appraisal prices to reflect market rates.

The ruling camp is seeking to raise the official prices from the current 50 to 70 percent of the market value of a home to 90 percent by 2035, with an annual increase of one percentage point in the first three years and three percentage points afterwards.

While the DP has denied speculation over increasing prices to 80 percent of a home's market value, the government could seek other ways to further cushion the impact on low-to-mid-priced homeowners.
Choi You Sun, KBS World Radio News.