Seoul readying compensation package for businesses affected by mitigation

[Photo by Han Joo-hyung]

The South Korean government is close to finalize the compensation package for self-employed and merchants whose business suffered from state-imposed social distancing measure over the last couple of months.

The Ministry of Economy and Finance and the Ministry of SMEs Startups are considering coverage of a fixed amount in payout to self-employed businesses with monthly sales of less than 4 million won ($3,625.5). For business with monthly sales exceeding 4 million won, it is likely to give compensation proportionate to their sales and the amount of damages.

The government has found it necessary to give some financial aid to small merchants and businesses that have been forced to shut down or restrict operation due to the government¡¯s social-distancing measures to slow the spread of Covid-19 infections.

It must work out the targets as some businesses already had been exempted from corporate taxes. Prime Minister Chung Sye-kyun and finance minister Hong Nam-ki reportedly met on Tuesday to discuss ways to provide compensation for the businesses as soon as possible.

The government also plans to discount rent by 30 percent to 100 percent and extend lease contract for merchants operating in Kangwon Land, state-owned casino resort that has been forced to close down for a long period of time. There are 15 stores including pharmacy, convenient stores and restaurants and 28 others that only open for summer or winter time.

Businesses will be given some relief for state-mandated four employment insurance program – the national pension, health insurance, employment insurance and industrial accident compensation insurance. The National Health Insurance Service said Tuesday that it will lower the cap of late payment rate for the insurance premium from the current 9 percent to 5 percent starting this month.

[¨Ï Maeil Business Newspaper & mk.co.kr, All rights reserved]