File pic — Bloomberg
Seoul: South Korea’s retail investors are trying to exert their influence on the country’s stock market policies, having tasted success in their last campaign.
Dubbed “ants” for their ability to influence policy when they act as a group, the individual investors are backing a proposal by President Yoon Suk Yeol’s administration to scrap a capital-gains tax imposed on financial investments.
The main opposition Democratic Party opposes the abolition of the levy, saying such a move would favour the rich and weaken the government’s coffers.
The debate surrounding the capital-gains tax strikes at the heart of a drive by South Korean authorities to galvanise the domestic stock market, which has lagged most of its Asian peers this year.
To drive home its point, a group of about 1,000 retail investors will hold a candlelight protest later this week to oppose a levy that the Korea Stockholders Alliance says is a “death sentence” for local equities.
“Our stock market isn’t faring well at all now,” said Jung Eui-jung, chief executive of Korea Stockholders Alliance, which has over 60,000 members.
“It’s premature to implement a capital-gains tax, and it should be reintroduced once our capital market enters the developed market environment,” he added.
The upcoming protest will take place as the main opposition party, which controls the National Assembly, prepares to hold a debate on Sept 24 to finalise its official position on the tax.
The levy in question requires investors to pay a tax of at least 20% if annual capital gains from their stock investments exceed 50 million won or about US$37,500. — Bloomberg
