[Exclusive] Party and Government to Announce Profit-Sharing System on 28th... Foundation to Support Small Business Owners and Socially Vulnerable Established

[Image source=Yonhap News]

[Sejong=Asia Economy Reporters Kim Hyun-jung and Jang Se-hee] The ruling party and the government will establish a fund to address the polarization caused by national disasters such as COVID-19 and will announce specific plans to share it on the 28th.

According to the Democratic Party of Korea and the government on the 25th, the ruling party and government discussed legislative promotion plans for the "Act on the Establishment and Operation of the Social Solidarity Fund" with such content on the same day. The related bill is expected to be officially proposed by Democratic Party lawmaker Yoo Dong-soo as early as the 26th, and the legislative promotion will be formalized after the high-level ruling party-government council meeting on the 28th of this month.

The Social Solidarity Fund Act mainly specifies the fund's purpose as "mitigating inequality and polarization caused by disasters" and defines the goal of the related law as "realizing social value." The bill will specify the fund's use as "emergency support projects for the livelihood and subsistence of small business owners, self-employed, and vulnerable groups who have suffered income reduction, unemployment, and other damages due to national disasters" and "policy research and institutional projects aimed at developing a donation culture to realize social values such as mitigating intensified inequality and polarization caused by national disasters."

It is also notable that the central government will actively intervene in establishing public interest corporations to raise the fund. According to the current Public Interest Corporation Act, public interest corporations must obtain approval from the competent authority for each related project. However, the Social Solidarity Fund Act being promoted this time plans to have the Office for Government Policy Coordination lead the application for fund establishment and consult with the competent authority, with the approval authority also held by the Office for Government Policy Coordination. This reflects the intention to unify channels to spread a voluntary donation culture.

Regarding this, a Democratic Party official said, "If a society or organization wants to create a foundation to operate the fund, the Prime Minister's Office will consult with the competent authority and grant approval." He added, "Through this, foundations in various categories such as education and culture for small business owners and socially vulnerable groups affected by national disasters can be established." This explains the plan to expand the target and method beyond the initially discussed fund operation for small business owners.

Meanwhile, amendments to the Restriction of Special Taxation Act and the Corporate Tax Act, which will include government contributions to the related fund and tax incentive support details, are scheduled for further discussion in the National Assembly next month.

This content was produced with the assistance of AI translation services.