'250,000 KRW per person' National Support Fund Cutoff Likely Set at '180% Median Income'... Excluding Asset Owners

Single-person household 3.29 million KRW/month · 4-person 8.78 million KRW
June health insurance premium reflected... Confirmed as of end of July
Excluding those with official property price over 1.5 billion KRW or financial income above 20 million KRW
Adults to receive with their own card

On the 29th of last month, two days before the implementation of the new social distancing reform plan, citizens were seen passing by on the streets of Myeongdong, Seoul. Photo by Hyunmin Kim kimhyun81@

[Sejong=Asia Economy Reporter Moon Chaeseok] The government is seriously considering setting the cutoff line for the COVID-19 coexistence national support fund, which gives 250,000 KRW per person, at '180% of the median income.' This corresponds to a combined monthly income of about 8.78 million KRW for a couple in a four-person household. Even if within 180% of the median income, asset owners who have houses with a publicly announced value of 1.5 billion KRW or more or financial income of 20 million KRW or more are being considered for exclusion from the payment target.

Monthly income of 8.78 million KRW for a family of four

Hong Nam-ki, Deputy Prime Minister and Minister of Economy and Finance, speaking at the '2nd Supplementary Budget for 2021 Joint Briefing with Related Ministries' held at the Government Seoul Office Building on the 29th of last month. (Photo by Yonhap News)

According to government authorities on the 4th, the government is reviewing a plan to operate the support fund by applying such a cutoff line. Earlier, on the 1st, a government task force (TF) involving the Ministry of the Interior and Safety, the Ministry of Economy and Finance, and the Ministry of Health and Welfare was launched to discuss the operation plan.

The TF is seriously considering setting the support fund payment criterion of 'bottom 80% income' at 180% of the median income based on this year’s standards. The 180% of this year’s median income corresponds to ▲3.29 million KRW per month for a single-person household ▲5.56 million KRW for a two-person household ▲7.17 million KRW for a three-person household ▲8.78 million KRW for a four-person household ▲10.36 million KRW for a five-person household ▲11.93 million KRW for a six-person household. Since it refers to 'household income,' in the case of dual-income households, the combined income of the couple is considered.

For workplace subscribers with 100 or more employees, the most recent previous income is considered, and for those with fewer than 100 employees, the previous year’s income is used. Regional subscribers are assessed based on 2019 income and property tax data as of June last year. All use recent statistics within the current legal and institutional system. Since regional subscribers’ income is based on 2019 data, a procedure for objections and adjustments to income and insurance premiums will be conducted later.

Reflecting June health insurance premiums, finalized in July

The government plans to finalize and announce the support fund cutoff line at the end of this month after reviewing June health insurance premiums and resident registration information. Generally, since the fluctuation in June health insurance premiums is significant, they intend to fully consider this.

Even if within the 180% median income cutoff, people with assets above a certain level will be excluded (cut off). The logic is that even if current cash flow is small, if one holds many assets, they should be considered high-income. Also, the cutoff principle is expected to apply to ▲combined property tax base exceeding 900 million KRW ▲financial income subject to comprehensive income tax exceeding 20 million KRW. This was the standard proposed when disaster relief funds were given to the bottom 70% income group last year. The property tax base exceeding 900 million KRW corresponds to a publicly announced housing value of about 1.5 billion KRW, and a market price of about 2 to 2.2 billion KRW.

The financial income standard refers to the '20 million KRW' threshold for comprehensive and separate taxation of interest and dividend income. If all were deposited in a 1.5% annual interest savings account, it means holding financial assets of more than 1.34 billion KRW.

Adults receive support on their own cards

[Image source=AP Yonhap News]

Adults aged 19 and over will receive 250,000 KRW per person starting from late next month. The payment is expected to be made on the card registered under their own name, not the household head’s. Earlier, the government decided on the 1st to provide 10.4 trillion KRW in national support funds at 250,000 KRW per person, and decided to give it 'per individual' rather than 'per household.' In other words, it is not a maximum of 1 million KRW per household, but a four-person household can receive 1 million KRW, and a five-person household can receive 1.25 million KRW.

The method will change from paying the household head collectively to paying each adult household member individually. For example, in a four-person household consisting of a couple and two university student children, each family member can receive and use their own 250,000 KRW support fund. Paying per individual allows each household member to use the support fund autonomously, and usage details can be immediately confirmed.

However, minors will receive the support fund through the household head again this time. For example, in a four-person family with two minor children, the household head father will receive 750,000 KRW covering the children’s shares, and the mother will receive her own 250,000 KRW separately. Detailed information will be finalized and announced after discussions by the relevant ministries’ task force (TF).

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