Government to Announce Support Measures for Accommodation and Performance Sectors Excluded from Loss Compensation in Mid-Month

Expected Excess Tax Revenue Over 10 Trillion+α
Support Under Review for Accommodation, Art & Museums, Kids Cafes, Wedding & Funeral Halls, Performance Venues, etc.

[Image source=Yonhap News]

[Asia Economy Reporter Jang Sehee] The government plans to announce additional support measures by mid-month for accommodation and exhibition sectors excluded from the loss compensation law support this month. The funding will be sourced from excess tax revenue expected to exceed 10 trillion won.

According to the government on the 7th, the Ministry of Economy and Finance is preparing support measures for small business owners who suffered significant damage due to COVID-19 but were excluded from loss compensation support, in consultation with related ministries. Low-interest loan support and discount events are being considered as likely options.

The Democratic Party is discussing excess tax revenue around 15 trillion won. The government is still compiling figures and cannot finalize the amount, but it expects excess tax revenue to exceed 10 trillion won.

Of the excess tax revenue, 40% must be sent to local governments as local allocation tax and local education finance allocation tax according to the National Finance Act. The government plans to use the remaining 60% for expanding the small business loss compensation budget, supporting sectors excluded from loss compensation, stabilizing livelihoods through measures such as fuel tax reductions, and repaying national debt.

The government is prioritizing support for accommodation, art museums, kid cafes, wedding and funeral halls, and performance venues that have been subject to personnel restrictions based on facility area, such as "one person per 4㎡."

These sectors were excluded from loss compensation because they were not subject to gathering bans or operating hour restrictions but were affected by government quarantine measures.

Travel businesses and cultural, sports, and tourism sectors such as outdoor sports facilities, which suffered indirect damage due to high-intensity social distancing, are also expected to be considered for support.

Considering the time required for budget formulation, processing, and execution, a third supplementary budget is realistically impossible, so the government is exploring ways to increase existing projects or mobilize funds to prepare support measures.

Low-interest loan support is the most frequently mentioned support measure. The government is considering various methods such as lowering loan interest rates, expanding loan limits, and easing conditions for using policy funds.

The government is also reviewing support plans that could increase sales in affected sectors through consumption coupons or discount events.

While the political sphere argues for cash support for sectors excluded from loss compensation, the government maintains a firm stance against this.

The government intends to use funds, excluding those spent on expanding the loss compensation budget, supporting excluded sectors, and reducing fuel tax, to repay national debt to strengthen fiscal soundness.

Based on the second supplementary budget, national debt stands at 963.9 trillion won, and the national debt-to-GDP ratio is 47.2%. Depending on the scale of national debt repayment, the ratio could fall to the mid-40% range.

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