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By Organisation for Economic Co-Operation and Development
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Acquisition, registration and capital gains taxes were lowered, and homes purchased before June 2003 were exempted from the capital gains tax. In addition, the “Excess Land Capital Gains Tax Act” and the “Land Ownership Limit Act”, which were introduced to restrain the surge in land prices during the late 1980s, were abolished. Finally, the “parcelling”5 system to allocate new houses was reformed. These measures, combined with the easing of monetary policy, significantly boosted demand for housing.
Firms in the non-agricultural sector employing more than ten workers. The Ministry of Labour began to survey firms with more than five workers in January 1999. 7 per cent in the first half of 2002. 3. Deflated by the consumer price index. 4. OECD projection for the first half of 2002. Source: Bank of Korea, Korea National Statistical Office and Ministry of Labour. 7 per cent. Moreover, some companies, including financial institutions, have already introduced the five-day workweek as a result of collective bargaining.
Indeed, monetary policy changes implemented after the 2003 target was set at the beginning of the year can only begin to influence inflation in the last quarter of the year and will have their major impact in 2004 and 2005. Shifting to a medium-term framework would encourage the central bank to take pre-emptive measures to control inflation and help minimise volatility in interest rates and output. However, the medium-term target is rarely mentioned in discussions of monetary Table 10. 5% Target horizon Target set by Over one business cycle Multi-year1 One year One year Indefinite2 Indefinite3 Multi-year4 Indefinite5 Three years Indefinite5 Government and central bank Government and central bank Central bank Government and central bank Central bank Government and central bank Central bank Central bank Central bank Government 1.
Oecd Economic Surveys: Korea 2003 by Organisation for Economic Co-Operation and Development