South Korea's financial authorities plan to introduce a new tax-advantaged individual savings account for investors who hold domestic stocks and exchange-traded funds for the long term. The account is expected to launch in the second half of 2027.
The proposed account would allow a payment limit of up to 200 million won, according to the Financial Services Commission. The policy is intended to reward longer holding periods and encourage households to keep more capital invested in the domestic market.
Market structure alongside tax incentives
Regulators are pairing the incentive with tighter attention to high-frequency trading. Authorities say algorithmic strategies that place large volumes of orders over very short periods can amplify market volatility.
For households, the practical value will depend on final tax rules, eligible assets and contribution conditions. Those details will determine whether the account becomes a meaningful alternative to existing savings and investment products.
For the market, the policy is a test of whether tax incentives can change investor behavior. The government is trying to build a larger base of long-term domestic investors while reducing trading patterns that can amplify short-term swings.