Ministry of the Interior and Safety Announces National Subsidy Direction for This Year's Local Love Gift Certificates

Regional Balanced Development through Differential National Funding Support by Area

[Asia Economy Reporter Kiho Sung] The Ministry of the Interior and Safety announced on the 15th that it will promote regional balanced development and revitalize the local economy by increasing regional autonomy and providing differentiated national subsidies based on local conditions for this year's local love gift certificate program.

This year, the national subsidy budget for local love gift certificates has been set at 352.5 billion KRW. From this year, the Ministry of the Interior and Safety plans to significantly improve the national subsidy method for the local love gift certificate project to ensure sufficient allocation to regions in need and support local governments to autonomously set discount rates according to their conditions.

Until now, the discount rate for local love gift certificates was uniformly set at 10% nationwide, and the national subsidy rate was applied at similar levels for each local government. However, this year, the program will be classified into three types?▲population decline areas, ▲general local governments, and ▲local governments not receiving ordinary local allocation tax?and subsidies will be applied differentially.

For population decline areas, the discount rate is set at 10% to revitalize the poor local economy, with 5% supported by national subsidies. General local governments can autonomously set the discount rate at 7% or higher, considering the stabilization of COVID-19 and the need for region-led issuance, with 2% supported by national subsidies. Local governments not receiving ordinary local allocation tax, considering their relatively sound financial conditions, will not receive national subsidies, and the discount rate will be autonomously set by the local governments.

[Image source=Yonhap News]

In addition to applying differentiated discount rates by local government, the Ministry plans to prioritize the financial conditions of local governments when calculating the scale of national subsidies. Until now, the scale of national subsidies was calculated mainly based on the population, issuance demand, and sales performance of each local government. This year, the focus will be on the financial conditions of local governments, providing more national subsidies to financially poor regions with a high need for support from the perspective of balanced development.

The Ministry of the Interior and Safety will finalize detailed national subsidy plans after surveying the issuance demand for local love gift certificates by local governments and will promptly proceed with related procedures so that the budget can be executed by early February.

Han Chang-seop, Vice Minister of the Ministry of the Interior and Safety, stated, “We expect that this policy direction reform will enable the local love gift certificate project to contribute to regional balanced development and local economic revitalization,” and added, “We will strive to enhance the effectiveness of the policy by increasing local governments’ autonomy while reflecting regional conditions as much as possible.”

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