Suwon City Reignites Movement of 'Ethical Landlords' with Property Tax Reductions and Incentives

[Suwon Ilbo=Reporter Seo Dong-young] Suwon City is rolling up its sleeves to revive the 'Ethical Landlord Movement' by providing substantial incentives—including property tax reductions and certification certificates—to ethical landlords who participated in rental rate relief for small merchants facing difficulties due to COVID-19.

The city has decided to provide local tax reduction benefits to participating landlords to actively promote the 'Ethical Landlord Campaign' this year.

First, tax benefits will be provided by reimbursing property taxes for 2020 and 2021.

The aim is to reduce the burden on landlords who shared the difficulties of small merchants by lowering rents, by reducing property taxes (local taxes) on buildings and land for the respective real estate.

The reduction rate varies depending on the actual rate of rental reduction among the annual contractual rent. For reduction periods of less than three months, an additional multiplier of 2 times the rental reduction rate is applied; for three months or more but less than seven months, 3 times; and for seven months or more, 4 times, so that the longer the rental reduction period, the higher the multiplier.

Accordingly, ethical landlords who reduced rent by 10% to small merchants over the course of last year or this year can receive a 40% reimbursement of property taxes.

The city will also issue certification documents to landlords who reduced rent by 10% or more for three months or longer, officially certifying their participation in the Ethical Landlord Movement.

Upon application based on an agreement between landlord and tenant regarding the rent reduction, the city will verify implementation and then issue the certificate.

Government support measures are also in place for landlords participating in rental rate reductions. By the end of June this year, 70% of the rental reduction amount will be granted as a tax credit on income and corporate taxes, and free safety inspections will be conducted for 5,000 establishments that reduced rent by 10% or more monthly.

The city plans to conduct campaigns to actively promote various benefits provided to ethical landlords and increase participation rates.

Previously, Suwon City saw a rental rate reduction movement spread as COVID-19 began to spread in the spring of last year. The city also implemented rental rate reduction movements involving reductions in public property rents and building owners participating in urban regeneration new deal project districts. The city also held meetings to encourage large shopping centers and building management organizations to actively participate in rental rate reductions. Through sustained efforts, it was found that more than 1,232 establishments participated in the rental reduction movement in the first half of last year.

Suwon Mayor Yeom Tae-young said, "As COVID-19 has prolonged, the difficulties faced by local small merchants have reached a critical point," adding "We hope the rental rate reduction movement will spread once again through the solidarity and voluntary participation of Suwon citizens."