The Democratic Party’s Leader, Lee Jae-myung, recently announced his agreement to abolish the Financial Investment Income Tax (FIIT), which had been set to take effect from Jan. 1, 2025.
With just 58 days until the tax’s implementation, the shift toward repeal is a notable development. Following Lee’s announcement, the KOSPI and KOSDAQ indices rose by 1.8% and 3.4%, respectively—highlighting the tax’s significant impact on market uncertainty in South Korea.
The income tax law, which includes the FIIT, was initially passed under the previous Moon Jae-in administration in 2020, led by the then-governing Democratic Party. Until recently, several opposition-affiliated civic groups had advocated for the tax’s implementation.
Addressing his shift in stance, Lee explained that the stock market is currently facing challenges and that it would be impossible to disregard the concerns of the 15 million investors who depend on it. Also, with his recent launch of a strategy office aimed at preparing for the next presidential election, it appears he could no longer ignore the criticism that the Democratic Party’s policies are dragging down stock prices in the nation.
Recently, Lee attended the SK AI Summit held at COEX in Seoul, where he met SK Group Chairman Chey Tae-won and participated in a policy meeting with global AI companies. This move seems aimed at demonstrating a commitment to economic issues and future industries, particularly as the president and ruling party remain entangled in internal disputes. While it’s natural for a politician to make such strategic calculations, questions remain about whether Lee, as the leader of the dominant opposition party, genuinely approaches national governance with responsibility and sincerity.
Last weekend, Lee led a rally outside Seoul Station, ostensibly urging the acceptance of a special investigation into First Lady Kim Keon-hee. However, his speeches also referenced the “candlelight revolution” and “judgment” of the current administration.
With the impending first trial ruling on his election law violation and alleged perjury, some observers wonder if he aims to incite public opinion against the president’s possible impeachment. Stirring up discontent over the weekend while attending economic events midweek may not be enough to demonstrate leadership readiness.
Although Lee attended the AI Summit, legislative initiatives like the AI Basic Law and the Semiconductor Special Act remain stalled in the National Assembly. During his bid for party leadership in July, Lee introduced the term “Meok-sanism,” a new slogan in Korean symbolizing a political philosophy focused on the “issues of everyday livelihood.” He emphasized that “growth recovery and sustainable growth are the core of Meok-sanism.” It is hoped that these words go beyond mere election rhetoric.
