SEJONG, Oct. 20 (Korea Bizwire) — Profits from land assets have gone to just a handful of companies and owners, official data showed Friday.
According to records provided by the Bank of Korea for the ongoing parliamentary audits, the value of private and corporate-held land came to 5,092.4 trillion won (US$4.49 trillion) as of end of last year. It marks an increase from 3,547.5 trillion won at the end of 2008.
Profits from the lands amounted to 183.8 trillion won as of 2015, equivalent to 11.7 percent of the nominal gross domestic product.
The profits went to select big owners, the latest findings showed. As of 2012, the top 1 percent of the private owners claimed 55.2 percent of the land. The top 10 percent owned 97.6 percent. Among corporate owners, the top 1 percent owned 77 percent of the land, and the highest 10 percent claimed 93.8 percent.
Rep. Kim Chung-woo, who had requested the records, said the data backs the argument for the revival of land ownership tax to help narrow the wealth gap.
Bringing back land ownership tax has become an issue under the five-month-old Moon Jae-in administration as a means to rein in real estate speculation. The government has not taken any concrete steps to revive it, but economic watchers count it as the next step should more measures be needed to deal with speculation.
The proportion of ownership tax in property taxes is 25.7 percent in South Korea, compared to 93.4 percent in the United States and 75.9 percent in Japan.
“The wealth gap would inevitably deepen further when profits from owned property grow since only a small number of people benefit,” the lawmaker said.