Payment Criteria Announced Today... Exclusion of <종부세> Taxpayers Under Review

Government Announces Basic Principles in Morning Briefing on the 3rd
Emphasis on Using Health Insurance Premiums to Target Bottom 70% Income Group

Hong Nam-ki, Deputy Prime Minister and Minister of Economy and Finance, is announcing the key points at a joint briefing of related ministries following the 3rd Emergency Economic Meeting held at the Government Seoul Office Building on the 30th of last month.
[Image source=Yonhap News]

[Asia Economy Reporter Jo In-kyung] As the government is discussing the criteria for selecting recipients of the emergency disaster relief fund due to the novel coronavirus infection (COVID-19), it has been reported that they are considering excluding (cutting off) high-value real estate owners even if they meet the income conditions.

On the 3rd, the government held a task force (TF) meeting of related ministries regarding the criteria for the emergency disaster relief fund payment, chaired by Yoon Jong-in, Vice Minister of the Ministry of the Interior and Safety, at the Government Complex Sejong, and plans to announce the discussion results through a press briefing at 10 a.m.

Previously, on the 30th of last month, the government held the 3rd Emergency Economic Meeting chaired by President Moon Jae-in and announced the introduction plan for the emergency disaster relief fund jointly with related ministries. Subsequently, on the 2nd, the Ministry of the Interior and Safety, Ministry of Health and Welfare, and Ministry of Strategy and Finance continued discussions on the recipients and criteria for the disaster relief fund.

The confirmed details so far limit the support recipients to about 14 million households in the bottom 70% income bracket, and plan to provide the funds through local government-issued regional gift certificates, electronic money, etc., depending on the number of household members. The support amounts are 400,000 KRW for single-person households, 600,000 KRW for two-person households, 800,000 KRW for three-person households, and 1,000,000 KRW for households of four or more.

The government has been reviewing methods mainly using health insurance premium standards to support up to the bottom 70% income bracket, as well as methods combining income and property. In particular, it is known that there is growing support for excluding those subject to comprehensive real estate tax as a criterion to filter out high-value asset owners.

Currently, multi-homeowners are subject to comprehensive real estate tax if the combined publicly announced price of their owned houses exceeds 600 million KRW, and single-homeowners are subject to the tax if the publicly announced price of their house exceeds 900 million KRW.

As an income criterion to be used after filtering out high-value asset owners, the amount of health insurance premium payment is being discussed. Initially, methods such as using income tax payment data from the National Tax Service or obtaining applicants' consent to verify financial and credit information were also discussed, but experts explain that adopting the health insurance premium standard is more efficient for quickly distributing the disaster relief fund.

The government is also expected to establish other detailed guidelines, such as whether to consider households that are separated but actually live together as separate households and provide payments separately.

Regarding the plan to split the funding for the disaster relief fund payment as 80% from the government and 20% from local governments, the government will gather opinions from local governments and prepare guidelines on how to divide the funds specifically.

However, even if the principles related to the emergency disaster relief fund payment are decided on this day, detailed review may be necessary regarding specific payment criteria or exclusion targets.

An official from the Ministry of the Interior and Safety said, "Since it is necessary to promptly provide the emergency disaster relief fund to citizens suffering from the COVID-19 situation, we will decide the payment criteria as soon as possible, but if additional consultation is needed, all related information will be disclosed."