Real Estate Tax Overhaul... Deputy PM Plays the 'Last Resort' Card

Deputy Prime Minister Koo Yun-chul, concurrently serving as Minister of Strategy and Finance, officially confirmed that he is reviewing increases in property holding tax and adjustments to securities transaction tax. In an appearance on KBS, Deputy PM Koo stated, "The intent of President Lee Jae-myung's remarks was that if other policies such as supply expansion and financial innovation don't work, we have no choice but to consider real estate tax as a last resort," adding "We are listening to various opinions and nothing has been decided yet." With the announcement of the July tax reform plan ahead, market attention is focused on the detailed direction.

Gangnam Property Prices Showing 'Some Adjustment'... Cautious on Comprehensive Stabilization

Regarding recent apartment price trends in the Gangnam 3-gu and Yongsan areas, Deputy PM Koo evaluated it as "a positive signal for the real estate market that regions that had risen significantly are now declining." However, he drew the line, saying "It is difficult to confidently say that there is overall downward stabilization," and emphasized preference for stable movement over sharp declines. He reiterated that the holding tax card is a conditional option to be played only if supply and financial policies fail to produce results.

Semiconductor Boom Offsets War Risk... Confident of 2% or Higher Growth Rate

Visiting Washington, D.C. to attend the G20 Finance Ministers' Meeting, Deputy PM Koo stated at a press conference at IMF headquarters that achieving more than 2.0% economic growth this year is possible. He explained, "The semiconductor boom is offsetting the impact of Middle East war, and we can even expect more than that." Responding to the OECD's downgrade of Korea's growth forecast from 2.1% to 1.7%, he said, "When you add the supplementary budget effect of 0.2 percentage point to the OECD's 1.7%, it becomes 1.9%, and we can know the corporate tax accurately after the August interim payment."

He explained that semiconductor demand increased 4 to 5 times more than initially expected due to AI transformation, increasing tax revenue, and that securities transaction tax revenue also increased with stock market activation. Regarding the 25 trillion won supplementary budget, he emphasized that "it utilizes excess tax revenue rather than issuing government bonds," stressing that the impact on fiscal soundness and prices is limited.

Meetings with Global Investment Companies at New York IR... 'Foreign Investors Rate Korea Higher'

Prior to his Washington visit, Deputy PM Koo held a Korean Economic IR in New York and held individual meetings with Apollo Chairman Marc Rowan, BlackRock COO Rob Goldstein, and others. Representatives from major investment banks including Citigroup and Goldman Sachs also participated. Deputy PM Koo conveyed, "Foreign investors' assessment of Korea is much higher to the extent that PIMCO's Vice Chairman said, 'Korea is a great country, and I don't understand why we're not investing in it.'"

He introduced capital market reform and AI transformation strategy to global investors, emphasizing, "The Korean government is treating the capital market as a key platform for economic growth and is pursuing reforms in line with global standards." He presented a "three-part package": 110,000 accounts opened after the launch of the Domestic Market Return Account (RIA), $5.1 billion in new inflows after inclusion in the World Government Bond Index (WGBI), and a 15% expansion of the National Pension Fund's currency hedging ratio.

From Exchange Rate to Supply Chain to Energy Transition... Presenting Direction for Complex Challenges

On the Korean won-US dollar exchange rate fluctuating above 1,500 won, Deputy PM Koo emphasized Middle East stabilization, saying, "If Middle East war risks are resolved, the exchange rate excessively diverged from fundamentals will return to normal." He reiterated the necessity for supply chain diversification and announced plans to expand domestic and international production investment focusing on key materials such as helium, bromine, and urea. Regarding the transition away from oil, he added that they are reviewing plans to provide incentives to public transportation and bicycle users.

Meanwhile, Deputy PM Koo is scheduled to hold a bilateral meeting with US Treasury Secretary Scott Bessent on the 17th to discuss Middle East war, exchange rates, and investment issues related to the US. The headquarters of the Korea-US Strategic Investment Corporation, which will oversee US investment operations, will be based in Sejong, with the inauguration ceremony to be held on June 18.