South Korea to use excess tax revenue to support small businesses

The South Korean government will use part of its excess tax revenue collected in 2021 to support small businesses hit hard by COVID-19. 

The government plans to use around 12.7 trillion won (US$10.7 billion) worth of support measures for pandemic-hit small businesses and vulnerable citizens through excess tax revenue and the state budget, reports Yonhap News Agency.

Some 5.3 trillion won (US$4.46 billion) of tax revenue will be used as subsidies and loans for small businesses, while another 2.5 trillion won of tax revenue will be used to trim treasury bond issuance, said Finance Minister Hong Nam-ki at a policy meeting, according to Reuters.

READ: Concerns raise over South Korea’s new workplace disaster law

South Korea has since launched a scheme to compensate small businesses for their incurred losses as a result of COVID-19 restrictions, but businesses such as travel agencies and accommodation have been exempted from such support.

The government anticipates an excess tax revenue of 19 trillion won (US$16 billion) this year amid the nation’s accelerating economic recovery.