Suwon Mayor Lee Jae-jun: "It's Time to Relax Regulations on the Overpopulation Restriction Zone Under the Metropolitan Area Maintenance Planning Act"

[Suwon Ilbo=Reporter Jung Jun-sung] Suwon Mayor Lee Jae-jun stated, "It is time to relax regulations on the overpopulation restriction zone under the Metropolitan Area Maintenance Planning Act."

On the 21st, Mayor Lee made these remarks in his opening address at a public discussion forum on "Regulatory Reform to Abolish the Extra Tax on Property Acquisition in the Overpopulation Restriction Zone," held by Suwon City at the Suwon Convention Center. He added, "Our country enacted the Metropolitan Area Maintenance Planning Act about 40 years ago by benchmarking countries like Britain, France, and Japan. However, as these three countries' national competitiveness declined, they either abolished or relaxed regulations in the law. It is now time for Korea to strengthen national competitiveness by relaxing overpopulation restriction zone regulations."

The forum, attended by approximately 200 people including Suwon City Council Speaker Kim Ki-jung, entrepreneurs based in Suwon, regulatory experts, and citizens, proceeded with opening remarks by Suwon Mayor Lee Jae-jun, a presentation by Professor Kim Kap-sung of the Urban Engineering Department at Yonsei University, a case presentation by a business representative from Suwon Delta Plex, and expert discussions.

Professor Kim Kap-sung, who presented on the topic of "Necessity and Response to Abolishing the Extra Tax on Property Acquisition in the Seoul Metropolitan Overpopulation Restriction Zone," stated, "Abolishing the extra tax in the overpopulation restriction zone can provide a new growth engine to overcome the low-growth trend," and added, "To stay ahead in the global economic competition of the Fourth Industrial Revolution era, it is inevitable to relax location regulations in the Seoul Metropolitan Area, where highly skilled workers prefer to settle."

He further argued, "It is necessary to either delete Article 13 of the Local Tax Act (Extra Tax on Property Acquisition in the Overpopulation Restriction Zone) or maintain the law while implementing a grace period to temporarily exempt the tax."

Kim Jung-sun, CEO of Myungsung ENG Co., Ltd., which manufactures automotive parts at Delta Plex Phase 2, said, "The company attempted to establish a factory this year after winning a contract for new items, but there were many restrictions on factory establishment in the overpopulation restriction zone," and added, "I would appreciate it if the burden on businesses could be reduced by excluding matters related to new construction and expansion within the legal framework that aligns with the purpose of the extra tax on property acquisition in the overpopulation restriction zone."

Panelists in the expert discussion included Lee Ki-young, Director of the Local Regulatory Innovation Division at the Ministry of the Interior and Safety, Ha Neung-sik, former Senior Research Fellow at the Institute for Local Finance, and Jo Pan-gi, Director of the Planning Division at the Korea Research Institute for Human Settlements.

Lee Ki-young, Director of Local Regulatory Innovation, stated, "Expert opinions that the extra tax on the overpopulation restriction zone has the problem of accelerating growth in growth management zones and natural preservation zones within the Seoul Metropolitan Area rather than promoting balanced development between the Seoul Metropolitan Area and non-metropolitan regions have validity."

Ha Neung-sik, Senior Research Fellow, predicted, "The extra tax on the overpopulation restriction zone accounts for a very small proportion of tax revenue, so there will be almost no tax loss from its abolishment," and added, "If investment in the area expands due to the abolishment of the extra tax, it could actually strengthen the tax base."