자본이득과세제도 개선방안

Abstract

It’s almost 10 years since the concept of “complete comprehensive gift” was introduced in the taxation of gift. For the income taxation an item is not to be taxable unless it is enumerated as a taxable income in the income tax code. The incompleteness of income taxation under the current income tax code is the most prominent in the capital gain taxation area. The author argues for the comprehensive capital gain taxation in terms of encompassing taxable capital gain items as well as assessing the amount of taxable gain. In principle all capital gain items should be taxed, for which purpose the author suggests the introduction of “comprehensive capital gain concept”. And the requirement of 5 year consecutive residency for the taxation of capital gain from a foreign located property should be discarded. The author also proposes the abolition of stepping-up of basis through gift or inheritance taxation of a property. The actual purchase price of a property should be accepted for the computation of taxable gain amount under the income tax code, even where the property was purchased from a related party individual. The capital loss should be allowed to be setoff with capital income in the year of its accrual and afterwards. The abolition of stepping-up of basis may result in an economic double taxation on the capital gain which have accrued in the hands of the transferor. The gift tax or inheritance tax paid by the transferee may be counted as a purchase expense for the computation of capital gain amount of the transferee at the time of his sell-off. The tax rate on capital gain should be set at the same level of the tax rate for capital income in general because capital gain is a capital income item. In an aspect the taxation on capital income invites the double taxation of an life-long consumption opportunity. The correct determination of the attribution of an capital income to an individual is never an easy job for the tax administration in the age of open capital market. Those may explain for the introduction of a flat-rate capital income taxation. The tax rate for capital income should be set at the current withholding tax rate on interest and dividend. A flat-rate capital income taxation will be able to be introduced only through full-fledged social discussions, which may result in the deviation from the original prototype.