Extension of National Property Rental Fee Reduction Until the End of June Next Year

Rental Benefits for Small Business Owners and SMEs Totaling 84 Billion Won Until November

[Sejong=Asia Economy Reporter Kim Hyunjung] The government will extend the measure to reduce the burden of rent on state-owned property, which has been in effect since April 2020, for an additional six months until the end of June next year. The benefits received by small business owners and SMEs under the previous measures amounted to a total of 84 billion KRW by November this year.

The Ministry of Economy and Finance announced on the 31st the "Notice on the Reduction of the Burden of Using State-Owned Property for Small Business Owners, etc.," which will take effect from January 1.

Previously, to ease the rent burden on small business owners and SMEs occupying public office buildings or leasing state-owned land, the government had reduced the rent rate on state-owned property to up to two-thirds of the previous level, allowed a maximum six-month deferral of rent payments, and lowered the late payment interest rate from 7-10% to 5%.

Currently, small business owners using state-owned property pay usage fees of 3% or more of the property value. To alleviate management burdens caused by natural disasters, pandemics like COVID-19, or economic downturns, the government applied a usage fee rate of 1% or more of the property value, which is about one-third of the previous rate. For SMEs, the usage fee, previously around 5% of the property value, was reduced to 3%.

In addition, the government extended the rent payment deferral period from the existing six months to up to one year for businesses subject to restrictions on the number of users or facility usage under the Infectious Disease Control and Prevention Act.

As a result of these measures, by the end of November, a total of 84,495 cases involving small business owners and SMEs received benefits amounting to approximately 84 billion KRW.

An official from the Ministry of Economy and Finance explained, "This additional extension will help small business owners and SMEs using state-owned property overcome the management difficulties caused by COVID-19."

Meanwhile, the Ministry plans to notify frontline state-owned property management agencies of detailed operational guidelines in line with the revised notice to ensure the smooth implementation of the rent reduction measures for state-owned property.

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