President Lee's Move to Halt ISA Reform Draws Fire from the Opposition: "Cowardly Evasion of Responsibility"

[Financial News] The People Power Party criticized President Lee Jae-myung's order to reconsider the reform of the Individual Savings Account (ISA) and the so-called "anti-stock-price suppression bill" included in the government's tax reform plan, calling it a "cowardly evasion of responsibility."
The Democratic Party of Korea (DPK), meanwhile, said it "welcomes the fact that the president directly recognized the problems and took action himself."
In a commentary on the 8th, Park Sung-hoon, chief spokesperson for the People Power Party, said, "Stop this sloppy state administration that announces first and fixes things only after the public pushes back," adding that "the amateurish pattern of 'announce first, reverse later' is leaving only the public and the market bruised."
He also said, "If there had not been fierce public resistance, would they have pushed ahead with the rushed reform plan as it was?" He added, "In the end, what has been exposed is that neither the president, nor Cheong Wa Dae, nor the government properly reviewed the policy's impact and side effects before announcing it."
He went on to stress that "this incident is not simply a matter of tax reform, but the face of a 'three-no' state administration that lacks the ability to make proper policy, the skill to verify it in advance, and the courage to take responsibility for failure."
The ruling party, by contrast, gave a positive assessment of the president's order to review the plan.
Lee Un-ju of the Democratic Party of Korea (DPK) said on Facebook that she "feels relieved and strongly welcomes the fact that the president has now recognized the problems and taken steps to correct them."
She also said, "We must keep the original promise of encouraging ISA accounts for the long-term investment of countless retail investors," adding that "we must not lose trust any further."
Meanwhile, on the 3rd, the Ministry of Economy and Finance announced the 2026 Tax Reform Plan, which would cap the previously virtually unlimited term of ordinary ISA contracts at five years and abolish the annual contribution carryover system. At the same time, it significantly expanded tax benefits for the newly introduced Productive Finance ISA, an investment product dedicated to domestic assets.
Under the existing system, ordinary ISAs could be extended indefinitely as long as they were maintained for at least three years. Investors could keep their accounts open for the long term, defer taxation, and benefit from compound returns at the same time. They also received tax advantages while investing in U.S. S&P 500 and Nasdaq 100 ETFs listed in Korea.
As public backlash over the government's plan spread, President Lee Jae-myung sharply rebuked the proposal during a status review meeting with Cheong Wa Dae aides on the 7th, asking, "Why did you do that without preparing it properly?" He added, "This is about reducing existing benefits, so why was it not properly reported and handled?" and ordered a full review.


[email protected] Lee Ju-mi Reporter