Yoon Suk-yeol's government to 'fully compensate' small businesses

Economy

Published: 28 Apr. 2022, 17:56 Updated: 28 Apr. 2022, 18:51

Yoon Suk-yeol's government to 'fully compensate' small businesses

Ahn Cheol-soo, the head of presidential transition team, announces the Yoon Suk-yeol's administration's compensation plan for small businesses at the team's headquarters in Seoul on Thursday. [JOINT PRESS CORPS]

Yoon Suk-yeol's government will "fully compensate" owners of shops and other small businesses affected by Covid-19, the transition team said Thursday.

The administration, which takes office on May 10, will ease eligibility requirements and extend the period over which damages are calculated.

According to transition team estimates, small businesses lost a total of 54 trillion won ($42 billion) in revenue as a result of government social distancing regulations.

Approximately 5.51 million shops and businesses will be eligible, the transition team said.

Details were not disclosed about exactly how the compensation amount will be calculated for each business and the precise minimum and maximum compensation. Additional information will be announced when the supplementary budget proposal is made after the Yoon government takes office in early May.

Ahn Cheol-soo, head of Yoon's transition team, said that less traditional businesses, such as those related to performances, exhibited artwork and tourism, will receive payments. They were excluded in the previous administration's programs.

"Even if they are not categorized as businesses banned from congregating, if they have suffered from Covid-19, such as tourism and performance businesses, they will be compensated for losses that they suffered," Ahn said.

The head of the transition team stressed that the compensation will not be given in fixed amounts but calculated so as to make up for actual shortfalls.

Based on data provided by government departments, including the Finance Ministry, the National Tax Service and the Ministry of Interior and Safety, the government will provide cash compensation according to the size of the damages that the businesses have suffered because of lost revenue during the pandemic.

"We are the first country to be able to have an accurate estimate" of the losses suffered by small businesses during the pandemic, Ahn said. "Based on the scientific estimates, we plan on a full compensation."

The transition team added that the minimum amount will also be raised from previous 500,000 won, but no amount was specified.

Other financial support was also promised by the transition team, including debt restructuring and debt and tax forbearance, to help business people cope as interest rates are increased.

The transition team did not offer any specific figures, including the size of the supplementary budget. President-elect Yoon has previously mentioned 50 trillion won when discussing the extra budget.

"The supplementary budget has to be considered comprehensively, not only the support of small businesses," said Ahn. "One can't ignore the medical costs, such as Paxlovid, which costs 800,000 won per person."

"Our role is to provide accurate data on compensating for losses to the National Assembly."

BY LEE HO-JEONG [lee.hojeong@joongang.co.kr]