President Yoon Suk Yeol urged Tuesday bipartisan efforts to abolish the deliberate monetary funding revenue tax and instructed the federal government to organize lifting a brief ban on brief promoting in March 2025 to shore up the inventory market.
Throughout a Cupboard assembly, Yoon addressed the continuing uncertainty surrounding the implementation of the monetary funding revenue tax, which might impose a 20 p.c tax on capital beneficial properties exceeding 50 million gained ($38,000) from inventory investments, or a 25 p.c tax on beneficial properties over 300 million gained.
Initially set for implementation final yr, the implementation has been delayed till January 2025.
The ruling Individuals Energy Occasion has pushed for its abolition to stimulate the inventory market, whereas the principle opposition Democratic Occasion is weighing additional postponement.
“I hope the ruling and opposition events collaborate on scrapping the monetary funding revenue tax to take away market instability and additional develop the monetary market,” Yoon stated.
“We intention to create a virtuous cycle the place firms increase their worth, and particular person buyers get pleasure from higher income and alternatives to construct belongings,” he added.
Yoon additionally welcomed FTSE Russell’s determination to incorporate South Korea within the World Authorities Bond Index (WGBI) in November 2025. He anticipated the inclusion to attract as a lot as 75 trillion gained of international investments, stabilize the rate of interest and the gained’s worth, and scale back borrowing prices for the federal government and firms.
“By being listed in a world bond funding index price $2.5 trillion, a brand new channel has opened that may add breadth and depth to our capital markets,” he stated.
To additional stimulate the inventory market, Yoon known as on related businesses to organize for the lifting of the momentary ban on brief promoting, set for March 2025, following the promulgation of a revised Capital Market Act through the assembly.
He stated the regulation’s implementation would allow the federal government to observe unlawful short-selling practices by means of an digital system and strengthen penalties for unfair buying and selling, anticipating to create a stage taking part in area for each particular person and institutional buyers.
Yoon additionally dedicated “company value-up” insurance policies to invigorate the capital market by offering incentives for firms that undertake shareholder-friendly insurance policies, equivalent to growing dividends or executing buyback applications, to resolve the “Korea Low cost.”
South Korea initially imposed the short-selling ban in November 2023 after allegations of bare brief promoting had been made towards a number of international funding banks. The ban, which was initially set to run out earlier than July 2024, has been prolonged till March 2025. (Yonhap)
