New Government Package for Business Owners Struggling with Tougher Distancing Measures
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[경향신문]
The government will hand out a disease control support fund of one million won, aside from the compensation for losses, to 3.2 million small business owners whose sales dropped due to stronger distancing measures in the wake of another COVID-19 wave. The government will also provide 100,000 won worth of supplies to 1.15 million owners of restaurants and cafes where the vaccine pass (vaccination certificate, certificate of negative test result) will be mandatory. The latest compensation for losses will be given to 120,000 businesses, previously not eligible for compensation, including barber shops, hair salons and other businesses with quotas or restrictions in the use of facilities.
In a joint press briefing on government support for small and self-employed business owners following stronger distancing measures at the government office in Seoul on December 17, Deputy Prime Minister and Minister of Economy and Finance Hong Nam-ki said, “We will use the established budget, various funds and reserves to prepare a package of three major items totaling 4.3 trillion won and quickly provide assistance starting at the end of this year.”
The 4.3 trillion won will be divided into the disease control support fund, 3.2 trillion won; vaccine pass supplies, 100 billion won; and compensation for losses, 1 trillion won.
First, apart from the compensation for losses due to COVID-19, the government will hand out a total of 3.2 trillion won in the name of the disease control support fund to 3.2 million small and self-employed business owners who suffer from stronger distancing measures. The government will hand out 1 million won in cash, regardless of sales volume or distancing level, as long as a drop in sales is confirmed. This will be given to over 900,000 businesses subject to closures and restrictions, which are legally eligible for compensation for losses, and 2.3 million businesses not eligible for existing compensation schemes, such as the travel business and performing arts business.
The government will also provide supplies worth up to 100,000 won to reduce the burden on businesses that will need additional supplies for the vaccine pass. Deputy Prime Minister Hong said, “About 1.15 million small businesses that will be subject to the vaccine pass, including restaurants, cafes, Internet cafes, study rooms and study cafes, will be eligible.” He also said, “We will provide the goods after verifying the purchase of items needed for disease prevention, such as a terminal for an electronic customers log, thermometers, and partitions.” The government will spend a total of 100 billion won for the goods.
The government will also expand compensation for losses to more business owners. The deputy prime minister said, “Until now, compensation was given to over 800,000 businesses where business was suspended, or business hours restricted. But we will revise the relevant regulations to provide better support and include 120,000 new businesses not included in the existing package, such as barber shops, hair salons, kids’ cafes, etc. which were subject to customer quotas, and provide compensation according to our compensation formula.” Thus, when we add the 2.2 billion won budget allocated to compensation for small businesses for Q4 this year and Q1 next year, the government will hand out a total of 3.2 trillion won in compensation for losses next year.
Earlier, the government raised the minimum quarterly compensation for losses from 100,000 won to 500,000 won. The government also announced that it would supply a total of 35.8 trillion won by providing loans of up to 20 million won per business at ultra-low interest rates, as low as 1%, mainly for businesses not covered by the 10.8 trillion won government support plan for small business owners released on November 23. The state will also issue 33.5 billion won worth of Local Love gift certificates and Onnuri gift certificates next year to restore the vitality in local commercial districts, where small business owners operate their stores.
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